South Australia leads nation in housing market strength
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Photo by Lara Jameson
South Australia has claimed the top spot in the latest HIA Housing Scorecard, outperforming all other states and territories thanks to strong migration patterns and strategic policy decisions.
The Housing Industry Association’s benchmark report, which measures residential building activity against long-term averages, places South Australia at the forefront of Australia’s housing markets.
“The outlook for home building in South Australia has taken a marked step up in recent years, as economic and policy dynamics increasingly shift in the state’s favour,” HIA Senior Economist Tom Devitt said.
South Australia’s performance has been bolstered by significant overseas immigration and reduced interstate outflows.
“South Australia has been supported by elevated numbers of overseas arrivals, and far fewer local residents leaving for other states than in recent history,” Mr Devitt said.
These population trends have helped drive exceptional results in key housing sectors.
“This has helped South Australia produce the strongest detached housing and renovations markets in the nation,” he said.
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The state has recorded particularly strong activity from first home buyers, with current levels second only to periods of major government stimulus.
“First home buyers have been more active in the South Australian market than any other. The only time they were more active in the state was during periods of stimulus associated with the GFC and the pandemic,” Mr Devitt said.
Investor confidence in South Australia has also reached unprecedented levels.
“Investors have also returned rapidly to the South Australian market, with the number of investor loans issued surging back to record highs,” he said.
The HIA credited South Australia’s policy framework as a key factor in its housing market success.
“Recent analysis by HIA has shown that policymakers in South Australia arguably have the best understanding of the problems facing housing supply and the actions required to improve the situation,” Mr Devitt said.
He highlighted several government initiatives that have positioned the state for sustained housing growth.
“The release of the South Australian Government’s Housing Roadmap included bold new planning reforms, streamlined development approvals, skills investment and a strong focus from policymakers on land release. This has South Australia well placed in terms of medium term housing supply,” he said.
The state’s stamp duty policy for first home buyers was singled out for particular praise.
“The complete and uncapped removal of stamp duty for first home buyers building or purchasing a new home in South Australia is also one of the best housing policies in the country. It would be desirable to see the policy take the next step and be extended to all new home buyers,” Mr Devitt said.
Western Australia and Queensland completed the top three rankings, with both states benefiting from population growth and relatively affordable housing.
Meanwhile, the scorecard showed New South Wales and Victoria losing ground, with expensive land, high taxes and regulatory barriers driving residents interstate.
The Northern Territory, Australian Capital Territory and Tasmania occupied the bottom positions, with residents moving interstate often due to unaffordable land.
Mr Devitt emphasised that future housing market success would depend on policy effectiveness.
“This is why the outlook for homebuilding across different markets is going to depend on the ability of state policymakers to bring affordable shovel-ready land to market and help reduce costs and regulations on home buyers, investors and the industry,” he said.
