Our rental market – “stopping communities growing”

Broken Hill ranks equal sixth for lowest dwelling vacancy rates in regional NSW LGAs– in other words there are not that many houses available for rent in our city, a fact most of those struggling to find a roof over their heads already know.

Rose Jackson, State Shadow Minister for Water, Housing and Homelessness was in town this week and she told the Barrier Truth the rental and housing market was an issue across regional NSW, “stopping communities from growing”.

“It is an issue across the state, but on top of that, Broken Hill has all of that, plus the additional tyranny of distance, just even further from the sight and the mind of decision makers in Sydney,” she said.

Rose Jackson, State Shadow Minister for Water, Housing and Homelessness

“I think that work can be done. There is opportunity for the government to work with local government to bring housing online. That is possible if there’s political will. But, we need a government that’s going to prioritise that.

“The [Broken Hill City] Council’s identified it as a priority, that’s great. Councils across regional NSW, to be honest, have done that and have been crying out to the State Government to partner with them to just get housing delivered.

“Fact is, people want to move in, they can’t. They can’t get workers, desperately-needed health workers or teachers, there’s a massive rental shortage because of that, which is then forcing up rents and putting a lot of pressure on vulnerable communities in those towns because they can’t afford to pay the higher rents,” she says.

According to research just released by the National Housing Finance and Investment Corporation (NHFIC) around 31% (or nearly three million households) in Australia are rentals, with 26 % of renters renting from private landlords and 3.0% renting from state or territory housing authorities.

In regional NSW, the vacancy rate is at its lowest level in the past 12 years after declining rapidly during the pandemic.

Broken Hill’s equal sixth ranking in lowest percentage dwelling vacancy sits at 0.6 per cent, which is calculated as a percentage of dwellings unoccupied at a particular time period.

It represents properties that are vacant and ready to rent, properties shut down after a tenant left, and properties unrented due to repairs or renovations.

Property Manager at Broken Hill’s Outback Real Estate, Patrick Reincke, says that while he can’t speak for all real estate agencies in the Broken Hill area, there’s certainly been “a long period of high demand yet low supply”.

“We’ve had an extremely high demand for rentals and it hasn’t really slowed down. Towards Christmas you might get a bit of a taper off,” he told the Barrier Truth.

“We’re expecting January to really pick up again as people look to move, people come to town, workers come and go so, at the moment, as a purely property management agency, it’s a course of high demand and low supply.”

Mr Reincke says Broken Hill is typically a place where people can come to perform a service for a few years or have a fly-in, fly-out option of working arrangements, and they all need rentals in the short to medium-term.

“When it comes to low vacancy rates, at one point this year we had almost full capacity except one vacant property.

“At one point for a month or two, we had nothing to offer people but now it’s obviously picked up and we’ve got a handful, maybe a dozen or so properties that have been listed,” he said.

“I’m not too sure about the vacancy rates – obviously studies are studies and are done at certain times – but there’s always a healthy turnover but there will be times of increased supply which, you may argue is happening right now, but there’s also times where probably in the middle of this year, people were coming in and saying ‘have you got any rental properties?’ and we’ve had to say ‘unfortunately, we literally have nothing available’ so it’s a bit of a mixed bag.”

In the broad Broken Hill-Dubbo region, in November 2022, the median asking rent was $405.88 (at the week ending November 20), an annual change in weekly rent of $53 or 14.9% – the second-highest percentage from regional New South Wales.

OpenAgent, in October, said the median weekly rent for houses in Broken Hill sat at $270 – a rental yield of 10.3%, signifying the annual income generated from rent as a percentage of the property’s value.

“When you have 20 people out there ready and primed needing properties, when a house that has been rented at $250 has been rented out for the past three or four years and we know that we’re about to advertise it at a time where we have people coming in every day to look for rentals, we might go ‘alright, we’ll reappraise it, the property has been at $250, with the demand now, is it worth $270, is it worth $280 because the demand is there and people are willing to pay for it?” says Mr Reincke.

“That’s not necessarily a reflection of us as property managers, we need to ensure that landlords aren’t gouging and being greedy and we need to try and educate landlords on the fact that we can’t just hike up rent because interest rates are going up or there is a high demand.

Shadow Minister Jackson says rental issues are a big priority.

“I think it’s a real shame that the current [Federal] government just don’t seem to be prioritising that work but it is a real priority for me because I can see how much it’s hurting the growth and economic development of regional communities and also hurting the people who are living here, particularly the vulnerable people, because they’re really being squeezed at the bottom of the market.”

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