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I think often people refer to anywhere hilly to the east as being the hills (Adelaide is pretty flat elsewhere) but there is actually an Adelaide Hills council.  You could possibly look at which areas that covers.  If you look on google maps at places like Teringie, Aldgate, Blackwood, Belair, Montecute and Eden Hills would all be considered to be in the Hills.  As would towns like Handorf and Stirling.

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Think what Nic says is about right. 

There are some links at the bottom of the page that list the areas

http://www.adelaidehills.org.au/about-the-adelaide-hills/overview

Also http://www.adelaidehills.org.au/images/PDF/AdelaideHillsMap2015.pdf

FWIW we live in the foothills but I don't consider it the hills themselves. However, we go a few hundred metres out our front door and we are in the Hills as it were. 

As to where to look, depends on what you want from a place. Hills living is not like living in the suburbs or even the outer lying suburbs. Also there is the fire risk which in the summer months can be extremely high on a daily basis. 

Do you have kids who need school options? Commute to work? Anything else? 

FWIW I love around Bridgewater, Aldgate and Stirling. But none of those are cheap. I also love Clarendon as a small town. It has a local shop, bakery, pub, hall and primary school. Not much else really. Houses can be in the town itself or dotted further out in one of the roads leading into the town. Again, its not cheap and if you have a commute to work or kids who are older and wanting to socialise or see friends, it could take some getting used to. 

I know people in Meadows, Kangarilla and elsewhere. All of those would need you to see them to appreciate what small town living could possibly be like. You'd need to travel elsewhere for pretty much everything. 

 

 

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I live in Hahndorf and consider it the hills but we are Mount Barker Council.  Also people say they live in the hills much further north like kersbrook and lenswood or even toward the Barossa or south like happy valley.

 

Mount Lofty ranges does cover quite a large area and all would be considered the hills.....

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