Central West and Orana – What’s Happening in the Housing Market?

The Central West and Orana region covers nineteen local government areas, including several regional centres. Housing market conditions and rent and purchase affordability varies significantly within the region, particularly between the larger centres and the rest of the region. There are declining numbers of affordable rental properties despite the increase in lower income rental households across the region and consequently there are higher numbers of lower income rental households in housing stress.

Central West and Orana Region – What’s Happening in the Housing Market?Housing Market - Rental

Rents Looking at all residential rentals combined together, there have been strong

increases in median rents in the Central West and Orana region for over a decade. Over the last 12 month period to June 2019, there has been more variation, with some LGAs continuing to experience price increases, some holding steady and others dropping. The graph below shows the increase in median rents for all dwellings in each Central West and Orana LGA from June 1990 to June 2019.

www.facs.nsw.gov.au

At June 2019, median rents for all dwellings in the Central West and Orana

ranged from $380 per week in Mid-Western Regional to $180 per week in Coonamble.

Generally the LGAs with major regional centres or proximate to those centres have higher median rents (in addition to Mid-Western, Orange $350 per week, Bathurst $330, Western Plains $310, with Oberon $328 and Cabonne $300).

The table below shows the change in median rents for (combined) all dwellings between June 2009 and June 2019 in each of the Central West and Orana region LGAs. Note that due to the amalgamation of Dubbo and Wellington during this time period, it is difficult to calculate the change in the median rent for Western Plains Regional.

Median Rent – All Dwellings

AreaJune 2009

June 2019 Change

% Change

Bathurst 220 330 110 50.0Blayney 170 288 118 69.4Bogan 165 240 75 45.5Cabonne 170 300 130 76.5Coonamble 125 180 55 44.0Cowra 165 250 85 51.5Dubbo 220   90 40.9Wellington 160   150 93.8Western Plains Regional   310  Forbes 165 248 83 50.3Gilgandra 140 188 48 34.3

www.facs.nsw.gov.au

Lachlan 130 220 90 69.2Lithgow 185 295 110 59.5Mid-Western 210 380 170 81.0Narromine 150 250 100 66.7Oberon 198 328 130 65.7Orange 240 350 110 45.8Parkes 170 283 113 66.5Warren   285    Warrumbungle 130 205 75 57.7Weddin   235    

Not including Western Plains Regional, over this time frame the highest increases in median rents occurred in Mid-Western Regional (81.0%), Cabonne (76.5%), Blayney (69.4%) and Lachlan (69.2%).

Vacancy Rate A vacancy rate of 3% is understood to represent a balance between supply and

demand in the rental market. According to REINSW data, vacancy rates were below 3% for both the Central West and Orana for much of the period from 2006 through to 2019. Especially in Orana, for much of that time the vacancy rate has been below 2% - indicating a chronic shortage.

At September 2019 the vacancy rate in the Central West was 2.3% and in Orana was 1.4%. This compares with 2.4% in New England and 1.0% in the Hunter (excluding Newcastle). While more recently vacancy rates in Sydney have eased, this is not the case in the Central West and Orana, where the market is still tight.

www.facs.nsw.gov.au

Affordable Rental The general trend across Sydney and NSW has been for a decline in the

proportion of rental stock which is affordable for very low, low and moderate income earners.

At September 2017, almost every Central West and Orana LGA (excepting Coonamble, Forbes and Lachlan), had a lower proportion of affordable rental for very low income households than was the case in June 2001.

Mid-Western Regional (21.8%) was the only local government area in the region with a lower proportion of affordable rental for very low income households than the average of 23.1% for the Rest of NSW at September 2017. Bathurst (24.2%) and Orange (27.4%) had the next lowest proportions in the region.

The graph below shows the change in the proportion of private rental accommodation affordable to very low income households in the Central West and Orana LGAs and Rest of NSW between 2001 and 2017. (Note there is no data for Western Plains Regional for 2017).

www.facs.nsw.gov.au

The proportion of rental affordable for low income households has also declined in the region, with a majority of LGAs having a lower proportion of affordable housing for low income households in 2017 than in 2001. There has been some improvement in the proportion of affordable rental over the last couple of years in most LGAs as the graph below shows.

Mid-Western Regional had the lowest proportion with 64.2%, followed by Orange with 66.1% and Bathurst with 68.4%. (Note there is no data for Western Plains Regional for 2017). No LGA had a lower proportion of affordable rental for low income households than the Rest of NSW average of 54.1%.

www.facs.nsw.gov.au

Rental Stress At the 2016 Census, the proportion of very low income households in rental

stress in the Central West and Orana ranged between 92% in Orange and 60% in Warrumbungle. There were three LGAs in the Central West and Orana with equivalent or higher proportions of very low income households in rental stress to the average of 89% for the Rest of NSW – Orange (92%), Bathurst (90%) and Blayney (89%)

There were no LGAs in the Central West and Orana with a higher proportion of low income households in rental stress than the average of 62% for the Rest of NSW. Lithgow had the highest proportion with 55%. However three Central West and Orana LGAs had more than half of low income rental households in stress (Lithgow with 55%, Orange with 54% and Bathurst with 51%). This is a very high proportion of low income renters in stress.

At the 2016 Census there were 6,988 very low and low income renters in housing stress across the region, up from 5,718 in 2011. This represents a 22.2% increase from 2011 to 2016.

The graph below shows the proportion of very low, low and moderate income households in rental stress in the Central West and Orana LGAs and the Rest of NSW at the 2016 Census.

The table below shows that there has been a significant increase in the number of very low and low income households in rental stress in the majority of LGAs in the Central West and Orana region between 2011 and 2016.

www.facs.nsw.gov.au

Area

2011 very low and low

income renters in

stress

2016 very low and low income renters in stress

change % change

Bathurst 1038 1228 190 18.3Blayney 122 170 48 39.3Bogan 43 16 -27 -62.8Cabonne 167 208 41 24.6Coonamble 52 49 -3 -5.8Cowra 315 326 11 3.5Western Plains Regional 853 1288 435 51.0Forbes 224 198 -26 -11.6Gilgandra 96 107 11 11.5Lachlan 76 98 22 28.9Lithgow 507 595 88 17.4Mid-Western 526 646 120 22.8Narromine 151 164 13 8.6Oberon 108 93 -15 -13.9Orange 897 1201 304 33.9Parkes 305 362 57 18.7Warren 30 35 5 16.7Warrumbungle 173 146 -27 -15.6Weddin 35 58 23 65.7Total Central West and Orana 5,718 6988 1.270 22.2

This strong growth in the number of very low and low income households in rental stress demonstrates the need for provision of targeted affordable housing. The largest increases have occurred in Western Plains Regional, Orange, Mid-Western Regional, Bathurst, Lithgow, Blayney, Parkes and Cabonne, as demonstrated in the graph below.

www.facs.nsw.gov.au

The table below shows the number and proportion of tenants in the Central West and Orana region who are in the private rental market, are in receipt of Commonwealth Rent Assistance (CRA), and despite this additional income support, are in housing stress.

Bathurst (41.6%) has a higher proportion of CRA recipients in housing stress than the average for the Rest of NSW of 35.1%, with Orange just under the average on 34.8%. The Central West and Orana region has an average of 28.9% of CRA recipients in housing stress.

www.facs.nsw.gov.au

AreaTotal CRA recipients

2016

CRA recipients in Housing Stress 2016

% CRA in Stress

Bathurst 3299 1372 41.6Blayney 398 105 26.4Bogan 141 34 24.1Cabonne 512 88 17.2Coonamble 337 65 19.3Cowra 916 159 17.4Western Plains Regional 3513 1006 28.6Forbes 548 80 14.6Gilgandra 349 52 14.9Lachlan 331 41 12.4Lithgow 1488 455 30.6Mid-Western 1726 498 28.9Narromine 440 97 22.0Oberon 276 72 26.1Orange 3879 1350 34.8Parkes 992 179 18.0Warren 168 31 18.5Warrumbungle 585 90 15.4Weddin 194 27 13.9Rest of NSW 201580 70760 35.1Total 20092 5801 28.9

Loss of Affordable Housing Stock DCJ has calculated the number of new bonds lodged with the Rental Bond Board

that were affordable to low income earners in the Central West and Orana region in 2006, 2010, 2013 and 2017. The region experienced a significant decline in affordable bonds lodged, and consequently loss of affordable housing between 2006 and 2017 – with 1,361 fewer affordable bonds lodged – representing a loss of 64.5% of affordable stock.

The table below shows the number of new bonds lodged that were affordable to low income households (including very low income households) in 2006, 2010, 2013 and 2017 in each of the Central West and Orana LGAs as well as the total for the Region.

It is clear from the table that Western Plains Regional (-790), Bathurst (-572), Orange (-433), Cowra (-270), Lithgow (-266), Parkes (-265) and Mid-Western Regional (-248) have suffered the largest numeric losses. Yet proportionately, Bogan has experienced the largest decline (78.8%), followed by Warrumbungle (78.4%) and Cabonne (78.3%).

www.facs.nsw.gov.au

No. of affordable rental properties for low income households

2006 2010 2013 2017

2006-2017 Change % Change

Bathurst 843 559 446 271 -572 -67.9Blayney 164 101 99 46 -118 -72.0Bogan 85 62 34 18 -67 -78.8Cabonne 161 144 106 35 -126 -78.3Coonamble 56 100 91 19 -37 -66.1Cowra 348 307 227 78 -270 -77.6Western Plains Regional 1161 771 565 371 -790 -68.0Forbes 214 220 149 58 -156 -72.9Gilgandra 97 58 100 29 -68 -70.1Lachlan 111 86 102 22 -89 -80.2Lithgow 411 293 230 145 -266 -64.7Mid-Western 404 376 232 156 -248 -61.4Narromine 168 137 98 44 -124 -73.8Oberon 113 85 94 32 -81 -71.7Orange 788 491 370 345 -443 -56.2Parkes 369 290 184 104 -265 -71.8Warren 23 35 38 12 -11 -47.8Warrumbungle 190 190 190 41 -149 -78.4Weddin 56 46 50 16 -40 -71.4

Total2,11

1 1,65

0 1,25

6 750 -1361 -64.5

These are significant losses and together with the increase in the number of low income rental households and lower income rental households in housing stress, demonstrates the need for provision of affordable rental housing.

Housing Market - Purchase

Sales Price Dwelling prices have experienced strong growth since 2003 in the Central West

and Orana. Over the period from March 2009 to March 2019 median dwelling prices in the region have increased by between 28.3% (Oberon) and 121.9% (Blayney). Due to the amalgamation of Dubbo and Wellington to form Western Plains Regional, it is difficult to determine the exact price growth for that LGA – however, price growth there has also been strong.

www.facs.nsw.gov.au

The following graph shows the long term median sales price trend for all dwellings in each of the Central West and Orana LGAs.

At March 2019, the median sales price for houses in the Central West and Orana ranged between $137,000 in Lachlan and $435,000 in Bathurst. Note there were insufficient sales of strata properties in most Central West and Orana LGAs to determine the median sales price for units.

The table below gives the change in median sales price for houses between March 2009 and March 2019 for Central West and Orana LGAs. There were insufficient sales in some LGAs to calculate a median.

Median Sales Price – Houses

www.facs.nsw.gov.au

Non Strata Dwellings March 2009 March 2019 Change % ChangeBathurst 265 435 170 64.2Blayney 178 395 217 121.9Bogan 128  Cabonne 190 276 86 45.3Coonamble 90  Cowra 168 257 90 53.4Dubbo 235   115 48.9Wellington 132   218 165.2Western Plains Regional   350    Forbes 136 229 93 68.8Gilgandra 130 169 39 30.0Lachlan 80 137 57 71.3Lithgow 197 345 149 75.6Mid-Western 243 408 166 68.2Narromine 173      Oberon 300 385 85 28.3Orange 285 412 127 44.6Parkes 219 276 57 26.0Warren 129      Warrumbungle 90 160 70 77.8Weddin 140      

The table below gives the median sales price for strata properties in Bathurst and Orange in 2009 and 2019. Note there were insufficient sales in any other Central West and Orana LGA to determine the median sales price for units.

Median Sales Price - Units

Strata Dwellings March 2009 March 2019 Change % ChangeBathurst 198 310 112 56.6Orange 204 261 58 28.3

Purchase Affordability In the Central West and Orana, purchase affordability for very low income

earners has declined in the majority of LGAs since 2001. In the Rest of NSW

www.facs.nsw.gov.au

there has been some improvement in purchase affordability since 2015, largely due to record low interest rates. However in Central West and Orana only three LGAs (Cabonne, Lachlan and Narromine) have seen some improvement.

At September 2017, Bathurst Regional (2.3%), Blayney (5.4%), Lithgow (7.1%), Oberon (0.0%), and Orange (7.8%) had a lower proportion of affordable housing than the average for the Rest of NSW of 9.0%. It is probable that Western Plains Regional also had a lower proportion but due to the amalgamation those figures are not available for 2017.

The graph below shows purchase affordability for very low income households in the Central West and Orana LGAs and the Rest of NSW between 2001 and 2017.

All the Central West and Orana LGAs had a lower proportion of housing affordable for purchase by low income households in 2017 than in 2001. Again there has been some improvement in purchase affordability in some of the LGAs in the region since 2015.

Both Oberon (12.5%) and Bathurst Regional (20.5%) have a lower proportion of properties affordable for purchase by low income households than the Rest of NSW average of 24.7% at September 2017. Note that Oberon has experienced the most dramatic recent decline in purchase affordability – dropping from 46.7% in June 2016 to 12.5% in September 2017.

The graph below shows the change in purchase affordability for low income households in the Central West and Orana, compared to the Rest of NSW, between 2001 and 2017.

www.facs.nsw.gov.au

Additional DataAdditional data on rents and sale prices, including both current and historical data, is available from the Rent and Sales Report on the Housing NSW website at:

http://www.housing.nsw.gov.au/About+Us/Reports+Plans+and+Papers/Rent+and+Sales+Reports/

More detailed housing data and tables used in this Snapshot are available from the Local Government Housing Kit Database on the Housing NSW website at:

http://www.housing.nsw.gov.au/Centre+For+Affordable+Housing/NSW+Local+Government+Housing+Kit/Local+Government+Housing+Kit+Database/

More information on vacancy rates is available from the Real Estate Institute of NSW website (see their media releases on vacancy rates):

https://www.reinsw.com.au/

www.facs.nsw.gov.au