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Tide turning in favour of investors

The West Australian

After years of record lows, the tide is starting to turn in Western Australia and investors are in prime position to strike, according to Endeavour Homes Managing Director Craig Endeavour.

He said WA had turned the corner, with the economy returning to growth and all signs pointing to a bright future. This change in the outlook has been precipitated by an increase in the rate of population growth in WA.

After a drop of 60,000 in 2015, figures show WA’s population is growing again. Data by commercial real estate services and investment firm CBRE show the state experienced a net increase of 21,000 people in the past 12 months.

The population of the Perth and Peel region in 2010 was approximately 1.65 million. It is expected to exceed 2.2 million by 2031.

Mr Endeavour said this was a marked change from the doom and gloom that existed for the past few years, and he predicted good times for the market.

“This is the first step in the recovery of Western Australia,” he said. “It’s really exciting as there are two real positives that come out of the population growth.

“Existing housing stock gets soaked up. That affects supply and people then go to the next level of pricing or they build. It will really stimulate the market.”

Another significant factor lending itself to the brighter outlook is the sharp decline in rental vacancy rates. Real Estate Institute of WA figures show the rates topped out at 7.3 per cent last July then fell for four consecutive quarters to 3.9 per cent, a level last seen in 2015.

“It has happened so quickly,” Mr Endeavour said.

“Yesterday we were all saying it was all doom and gloom, but vacancy rates have dropped considerably in just a year.

“When people were leaving the state, it became a tenant’s market due to the number of properties that were available.

“Now we’re seeing conditions moving back in favour of landlords, so it is a great time for investors.

“Investors need at least five per cent return. The average now is around five-and-a half per cent. When you claim two per cent depreciation, that leaves a seven per cent return. That’s before investors have even claimed back their borrowing costs.

“So in this market where interest rates are low, you can get a great return of investment.

“We’re going into an upswing in the cycle and it’s a great time to invest in the market.”

CBRE Director of Residential Valuations Michael Valetta agreed the horizon was looking brighter and said recent data showed there was growth ahead.

“An increase in population growth and decrease in vacancy rates present real opportunities for the real estate market,” Mr Valetta said.

“I see great potential in Western Australia. After some lean years, signs point towards the fact we are turning things around.”

CONTACT Endeavour Homes

9263 4444, www.gemmill.com.au.

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Hello!

Gemmill Homes has recently changed its name to Endeavour Homes!!!

We are excited with the new name Endeavour Homes, business has been great for our customers and us last year, despite all the craziness of 2020.

Here are some wins:

1. Every one of our display homes won MBA awards in their categories.

2. One of our homes even won an MBA best home in Australia.

3. Most importantly, we have built some beautiful homes for our clients.

Why the name change you may ask?

Here are the two main reasons:

1. We reinvented the way we help clients and have a new way to provide better service, better quality and happier clients than ever before. We want to celebrate these changes with our new name.

2. We want to align the business name to our sister brand Endeavour Constructions as the business has been owned by the same family since our inception in 2004.

Anyway, enough about us…now it’s your turn, have a look around our website and see how we can help you.

All the best the Endeavour Homes Team