Opportunity knocks for developers willing to meet the chronic demand in the Yass Valley property market for affordable housing. A recent release of 3-bedroom homes on compact blocks sold off the plan in less than a fortnight with many missing out. For this edition of Yass Valley Times our journalists investigated what is driving our rising house prices, what opportunities there are for more affordable homes to be built, and what’s ‘hot property’ in Yass.
House prices in the Yass Valley have risen by 24.7 per cent in the past five years from an average price of $490,000 in June 2015 to $611,000 in June 2020.
Last year, the average house price in the Yass Valley grew more in a single year than any other regional area in NSW.
While this is good news for homeowners, Yass real estate agents Andrew Curlewis and Edwina Brown say they are concerned about the shortage of affordable housing and rental properties in the area.
The shortage is driven by Canberrans moving across the border and contractors employed at nearby wind farm developments and in need of short-term accommodation, Yass Real Estate principal Ms Brown said.
“When you put those together, there is certainly a shortage,” Ms Brown said.
One of those developments is Bango Wind Farm, where outside contractors are expected to be employed until it is completed and fully operational in the fourth quarter of 2021.
Lyn Diskon of CWP Renewables, which owns the wind farm about 30 minutes north of Yass, said the number of outside contractors hired varied depending on the stage of the development. She said the wind farm also hired local contractors.
“Once most of the heavy civil works are completed, then some workers will move on,” she said.
However, many of those outside contractors who do come to the area would need smaller rentals as they often travel alone, Ms Diskon said from her anecdotal experience.
“Most of those who I have met do not have their families here,” she said.
Yass Real Estate Principal Edwina Brown outside one of her listings 41 Polding Street in Yass which is typical of the properties in current short supply which meet the needs of three markets: investor-rental, downsizer and first homeowners.
“This is your downsizer or rental market and that’s the sort of people who are looking at it. This is a typical example of the homes becoming more and more scarce, particularly in the price range of $450-600,000. This one won’t be around long; it is one of those homes that is neat and tidy, move-in ready so people do chase it.”
Government response needed as low incomes knocked out of the market
Another reason for the shortage of affordable housing and rentals is the increasing demands on private landholders, Ms Brown said.
“By the time you add in what they are paying for rates, maintenance and to get into the market, the rental return they need to make the investment viable is higher. And if it is an unviable investment, then you have a mass exodus of private landholders from the market and contrary to what some people would like to see, you are going to have an even greater shortage of rentals,” she said.
“Unfortunately, private landholders are not the government, they are not social housing providers, so they have to see a return.”
Ms Brown’s solution is for the government to purchase land at a cheaper rate.
“There has been no investment by any government body to procure land and build any further. They are the ones who need to provide those low-cost developments. They do not need to gain the same return because they are not repaying bank loans etc. However, there has been no investment by any government body to procure land and build any further locally,” she said.
Developers respond to a hungry market
Yass Valley Property principal Andrew Curlewis said he was working with two local developers to build more affordable housing.
Mr Curlewis said local developer and builder Chris Pothan’s third stage of three bedrooms, one bathroom, community title blocks, on Morton Avenue in Yass sold out before construction began.
“For people to buy houses in that lower price range, they are normally looking at buying an older house that needs work. This development provides big veneer, north-facing and low maintenance houses. Strata titles tend to be more expensive, but these are community titles, so the cost and maintenance are down,” Mr Curlewis said.
“We have sold to first-home buyers, investors and downsizers. I do not know why more builders don’t go for this type of development more often. Most builders go for the higher end – four bedrooms, two bathrooms and two garages and they are in the $600,000 to $700,000 price range and competing with everyone. We identified that no one was having a go at this end of the market.”
Mr Curlewis said the Walker family, which is behind the Yarrah development on Laidlaw Street in Yass was also hoping to provide affordable housing on smaller blocks.
“You have got to have a mix. Not everyone wants a 1000 square metre block with a 300 square metre home – not everyone can afford to run and maintain it.”