Wagga Wagga rental market still oversupplied despite flooding of 250 homes: PRDnationwide

Wagga Wagga rental market still oversupplied despite flooding of 250 homes: PRDnationwide
Wagga Wagga rental market still oversupplied despite flooding of 250 homes: PRDnationwide

Wagga Wagga’s status as a property hotspot may come under threat in 2012 with the current oversupply of rental properties expected to persist despite an increase in demand for temporary accommodation due to the March floods. 

Located 450 kilometres from both Sydney and Melbourne, Wagga Wagga is NSW’s largest inland city, with a population of 63,500 people. 

About 250 properties were flooded when the Murrumbidgee River burst its banks in early March this year. 

Research carried out by PRDnationwide has found there are currently 230 houses and 100 units available for rent in the city. 

The property group expects that some of these properties will be rented by residents whose houses have been flooded. 

However, the long-term forecast is for rental vacancies to rise due to the completion of nearby Sturt and Hume highway upgrade projects, during which workers have vacated their rental properties in Wagga Wagga. 

In addition, the expansion of Charles Sturt University in North Wagga, due for completion next year, will add about 160 bedrooms, further adding to the supply of properties in the region. 

In 2011 there was a 10% drop in housing transactions in 2011, with 463 properties sold, according to PRDnationwide. 

Over this time the median house price declined by 3.4% to $259,000 while units were more resilient, recording a 0.9% decline to $217,000. 

Despite the drop in house prices, vendors selling detached houses in 2011 still recorded solid capital gains of around 5.9%. 

The most sought-after locations were suburbs closest to the city, with the Wagga Wagga town centre accounting for nearly half of all sales, followed by nearby Kooringal, Glenfield Park and Lake Albert. 

A smaller number of sales was recorded in newer suburbs like Springvale and Tatton.

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House prices between $250,000 and $299,000 accounted for nearly one in four sales while there was also strong appetite for properties prices up to $450,000. 

There are currently 207 properties for sale in this price bracket according to realestate.com.au including this original three-bedroom Federation cottage (pictured below) on the market for $295,000 complete with pressed ceilings and an outdoor toilet.

It last sold for $132,500 in 1996.

It is being sold by Grant Harris of Raine & Horne Wagga Wagga.

A more modern offering aimed at investors is this three-bedroom house in Glenfield Park (below) available through Mark Steel from PRDnationwide Wagga Wagga. It is on the market for $269,500 with rental potential of $300 per week, a yield of around 5.8%.

Wagga Wagga was picked as a hotspot in the top 100 suburbs list by Your investment property magazine in 2011, with the publication noting that house prices had risen by 9% every year for the past 10 years. 

According to Hotspotting.com.au director Terry Ryder, the appeal of Wagga Wagga includes its standing as a regional centre for a very wide area, its status as an educational hub and as a good place to retire to due having a number of very good medical facilities. 

“It has got a multi-faceted economy, and some of the big impetus comes from the RAAF base – there is an army base outside of Wagga Wagga that is expanding. 

“These expansions will generate economic activity, jobs, demand for housing,” he says. 

Wagga Wagga is one of seven cities that form part Evocities, a project funded by the Australian government aimed at encouraging more people to relocate from Sydney and other metro regions to one of seven regional cities. The others are Albury, Armidale, Bathurst, Dubbo, Orange and Tamworth and take advantage of the NSW government’s $7,000 regional relocation grant. 

Evocities lists Wagga Wagga employment prospects as being “medical and allied health, aviation, education & training, engineering, construction, retail, property and business services, public sector and hospitality”. 

It says there are 20 primary schools and eight secondary schools in Wagga Wagga as well as the a number tertiary education facilities including the aforementioned Charles Sturt University, the University of NSW Rural Clinical School, the University of Notre Dame Rural Clinical School, TAFE NSW and Australian Airline Pilot Academy. 

Wagga Wagga is a one-hour flight from Sydney, with 58 flights per week.

 

 

 

 

Larry Schlesinger

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

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