The resources boom has dominated trends in the Australian property market over the past couple of years, and 2008 is no exception.

Last year was Perth's year for property price growth due to the city's proximity to the resources boom, although with affordability issues now affecting the city – along with Brisbane, Melbourne and Sydney, Adelaide looks likely to be the property boom town of 2008.

With mining at Roxby Down opening up this year, Adelaide looks likely to build on the 31 per cent property price increases it saw in 2007 (Source: RPData-Rismark Hedonic Index). Without the land restraints of Sydney or Brisbane it is predicted to experience sustainable double-digit growth without the high values which have priced many overseas property buyers out of other Australian city markets.

Adelaide is also benefiting from an injection of international migrants, pushing up demand for property in the South Australian city.

"South Australia's share of international migration has risen sharply since 2001 lifting the (net) number of migrants from a low of 2,500 in 2002, to 13,200 in 2006/07," reported the ANZ Australian Property Outlook earlier this week. "This has provided a significant boost to underlying housing demand which is now running above new supply and is driving an ongoing tightening of market conditions."

"House prices rose by 16.2 per cent over the year to September buoyed by a tightening housing demand/supply balance that is reflected in the lowest rental vacancy rate of all the state capitals (1.1 per cent)," the report continued. "The tightness in the rental market has pushed up advertised rents by 22 per cent over the year to September and with rental vacancies forecast to reach record lows in the years ahead strong upward pressure on rents will be maintained."

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Article first published 04 January 2008