A walk through one of NSW's tightest rental markets
The most recently released Real Estate Institute of New South Wales statistics, while discussing a seasonal increase in vacancy rate across Sydney, noted that Orana is the tightest rental region across the state at 1.6%.
The region, which extends up from the Great Dividing Range to Cobar and Bourke in the west and to the Queensland border, covers just under 200,000 square kilometres and around 120,000 people.
It has three major localities, Dubbo, Cobar and Mudgee with vacancy rates noted to be 1.5%, 2.1% and 4.4% respectively, according to SQM Research. Interestingly, all three of these areas have been noted as the next best hotspot in the recent past, with 2012 seeing significant growth for all three.
With this in mind, we decided to delve into the Dubbo market and find out just what the rental situation is like in this significant part of Orana.
More statistics on Dubbo
In Dubbo, with 32,327 people according to the Australian Bureau of Statistics’ latest 2011 Census data.
The ABS puts the weekly household income at $1,052, the median monthly mortgage repayment at $1,473.
The median age is 35 with an average of two children per family. The area has significant tourism drawcards, a health base and a large shopping centre, and serves as the central location for the entire Orana region being strategically located on highways and significant roads. It also hosts an airport that recently underwent an upgrade, as well as a main railway line.
The employment breakdown looks like the following:
Source: Australian Bureau of Statistics
RP Data’s latest statistics put rent in Dubbo at $250 for units and $310 for houses. Hunting through rental listings, it seems that the $310 median will secure a three-bedroom one to two-bathroom house.
For instance, 12 Page Avenue (pictured below) was up for rent with Ray White Dubbo and is now under application. Close to Orana Mall, with a single lock up garage and ducted evapotated cooling the three-bedroom, one-bathroom house was asking $310 per week. RP Data notes that it was bought back in 1997 for $108,000. Rent appears to have come down since October 2012, when it was asking $320 per week.
With prices at $280,000 for houses and $207,500 for units, and 3.7% growth in the last year, it is not surprising that the affordable prices and relative rental yields are appearing attractive to investors. Interestingly, Dubbo has also made it onto some of the most recent magazine hotspotting lists, in some instances for a number of years in a row; however, it underperformed last year against expectations. Terry Ryder has been backing Dubbo for some time and in fact, in 2012, the early investors into the market would have seen some significant yearly growth.
"Whenever I mention Dubbo in the same sentence as the word “hotspot”, people are incredulous. For some reason no one expects anything exceptional to happen in places like Dubbo. But this is a vibrant regional city moving forward with increasingly large strides," he wrote in August 2012. And he isn't the only expert predicting growth for the area, with PRDnationwide releasing a report in late-2013 that saw unit rents increasing 17.1% for a standard two bedroom unit over the previous 12 months, while three bedroom houses seeing a 7.1% increase. They believe that the area is in a growth phase.
There are a number of activities happening the area that have been broadcast on Twitter.
NSW Fair Trading issued an urgent warning to be on the look-out for travelling conmen around Dubbo and Orange. https://t.co/gZIn0km7Ll
— Tradebusters (@tradebusters) January 14, 2014Dubbo's synthetic athletics track has started construction! Forward thinking council. 1st in reg NSW. @Barnaby_Joyce pic.twitter.com/mnfyonjq4O
— Caroline Chapman (@CarolynChapman1) January 11, 2014#Dubbo #Zirconium mine responds to submissions - ABC News (Australian Broadcasting Corporation) https://t.co/4aEgLQIGvp
— ABC Western Plains (@ABCDubbo) January 13, 2014Dubbo Council defends withholding of their next Keswick Estate land release, tonight at 7. pic.twitter.com/xK3BYlP1uN
— WIN News CentralWest (@WINNEWS_CW) January 8, 2014So will Dubbo stack up over 2014? We will all be watching closely to see what the year holds for the area.
