After months of steady house prices, Adelaide's housing market has jumped by 3% in the June 2006 quarter to record a strong median of $286,500.

The Real Estate Institute of South Australia (REISA) said this was also a 4.1% increase from 12 months ago and matched rising trends across the State.

REISA President Mark Sanderson said this strong result was expected as the market had been buoyant for the past couple of months.

“There is vigour in the Adelaide marketplace at the moment,” Mr Sanderson said.

“Real estate professionals have been seeing a renewed interest in the property market and the steady prices we experienced leading up to the June quarter has triggered this demand.”

Mr Sanderson said sale numbers in the metropolitan area had risen significantly this quarter, which was a strong sign that investors and first homebuyers were returning to the market.

“Our tight rental market, which has had consistently low vacancy rates over the past 12 months, has also brought investors back to the market,” he said.

“This shows South Australians have confidence in the local market and proves bricks and mortar really is the best investment.”

In the preliminary June quarter figures released by the State Government this week, the State-wide median house price also rose to $270,000. This is a 5.4% rise from last quarter and 5.8% from this time last year.

Mr Sanderson said the western suburbs experienced strong price growth in the June quarter.

“Fulham Gardens and West Lakes in particular performed superbly with 28.7% and 28.4% increases respectively over the past 12 months and had high sale volume,” he said.

“This is due to their proximity to the sea and huge potential for redevelopment and subdivision.”

He said unit and apartment prices had dropped a little in the city, but across the metropolitan area the median had stabilised at $215,000.