One Australian capital city market is starting to show all the hallmarks of a recovery, meaning investors could soon be circling.
’s market is set to recover, and there are various signs indicating things are turning around, according to Craig Gemmill, managing director of Gemmill Houses.
One major sign, he said, was a decline in the vacancy rate, which has dropped from its height of 7 per cent to 2.3 per cent, according to his data.
“Once the vacancy rate drops like that, and it dropped quite quickly, it dropped in a 15-month period, so therefore, you’re going to have an increase on pressure on rents,” Mr Gemmill said.
“So, rents are going to start going up, which is going to be a better return for the investors.”
Another sign is a notable rise in the mining and resource sector.
“When these mining and resource companies take off, people come over here and they get their jobs, but there’s always a lag because people are on contracts,” he said.
“What we find is that they’ll generally wait 12 months to see that their contract’s either going to get renewed or this is going to be sustainable.
“[If] it is going to be sustainable, so we would go into that buying phase probably towards the end of 2019 into 2020.”
Mr Gemmill added that the sign to watch out for that indicates the next stage of the recovery is when investors return to the market.
“They’re astute. They know when it has reached the bottom. They know the prices aren’t going to drop any more, and they want to get the upswing now. And in my opinion, that upswing, the time to buy, is now,” he said.
Where they should be buying, according to Mr Gemmill, is north of the Swan River, which saw a number of suburbs benefit from the state government’s R-Code system for rezoning, which includes the suburbs of Joondalup, Padbury, Craigie, Kingsley and Hillarys.