Home buyers could soon be opting for an "Oasis Change"

Posted on 5/05/2007  
Investors looking to buy residential property in any of Australia’s boom real estate areas should be adding “water security” to their list of investment criteria.

 

A  lingering drought, its impact varying from region to region and state to state, has brought strict water restrictions, increasing the cost of water use and propelling the issue up the list of domestic priorities.

 In the ongoing water debate, the dry spots are easily identified – they are the ones being written about in daily newspapers; the ones that give current affairs television the much-needed footage of parched and cracked earth and elderly ladies carting buckets to water their gladioli.

But what about the “water rich” areas - what is happening with real estate in towns and regions perceived to have plenty of water?

Our research suggests that governments looking for solutions to the water crisis could do worse than study the water-management systems of the towns and cities which we have identified as being relatively well-placed. We found places including Hobart, Dubbo, Port Macquarie, Taree, Queensland’s Sunshine Coast, Townsville and Diamantina Shire that have managed to avoid the worst of the situation because they have plentiful rain, and/or access to river water or underground aquifers.

Overall, Tasmania and the Northern Territory are blessed with good seasonal rainfall and a sustainable population and are free of water restrictions, though obviously most people will not want to move to the wilds of Tasmania or the far-away climes of Darwin just to be sure they can have a reliable water supply.

Queensland water positive areas

Townsville rates as a city where the town fathers have thought ahead and planned for times when the tropical north gets its customary deluge. Townsville is fed by the Ross River Dam, which is being upgraded and there is also a link to the Burdekin Falls Dam. Sadly, the Ross River dam was in the middle of that upgrade and only operating at 36% capacity when the February deluge hit Townsville, washing the equivalent of two years’ supply out to sea. However, once the $115 million upgrade is completed, storm water will be better controlled during seasonal floods, to keep the 219,000 megalitre dam at capacity.

The far north Queensland towns on the Atherton Tablelands receive huge quantities of torrential rain in the wet season. This year Innisfail received 887mm of rain in February, 300mm above the average. In 2006, Innisfail received 3898.7mm of rain, 850mm more than in 2005 (850mm is more rain than Dubbo gets in a year). Water storage in Cairns is at healthy levels and gardeners there are allowed unlimited hand held hosing and sprinklers three times a week. 

The 95,000 square kilometres contained within Diamantina Shire in far western Queensland (including the towns of Birdsville and Bedourie) has abundant water in the Artesian Basin beneath its seemingly parched surfaces. Recently the Diamantina Shire Council mayor Robbie Dare told the ABC he was considering bottling the water and putting it on supermarket shelves, revealing that one bore alone puts out six million litres a day. However, it should be cautioned that most of the water was laid down hundreds of thousands of years ago, and only minor re-charge occurs along the western edge, so although reserves are vast, it is a finite resource.
 
New South Wales

Dubbo in central New South Wales has a secure water supply from the Macquarie River (70%) with the balance drawn from bores. Water restrictions are not in force, but the Dubbo council keeps a strict eye on water use via 12,000 meters attached to dwellings. Dubbo’s annual mean rainfall is currently running at 569mm (long-term average 619mm).

There are no restrictions in Newcastle, New South Wales. For a start, Newcastle can expect 1100mm of rain per annum (almost double the New South Wales historical average) and according to the Newcastle City Council website, the city implemented an urban water cycle policy some years ago.

The central–western NSW town of Bathurst gets its water supply from two dams, the Ben Chifley and Winburndale dams. Ben Chifley dam, which supplies most domestic water, is at 50% capacity, so there are no current water worries. Even so, Bathurst regional council has been pro-active in developing a drought contingency plan. It must be clear to many that Bathurst is a ‘goer’ – the population increased there by 1.5% in 2005-06, compared to 0.8% for New South Wales as a whole.  

Port Macquarie and Taree seem to be doing OK storage-wise. Taree’s water restrictions are limited to common-sense prohibitions on watering during the heat of the day, while Port Macquarie allows hosing on alternate days (Brisbane residents might remember that luxury).

Other states

 Hobart, which has ample water from the Derwent River and the high country around Tasmania’s capital, nevertheless had water restrictions in place until February this year. No other town or city in Tasmania has water restrictions and neither does Darwin or anywhere else in the Northern Territory.

Western Australia is traditionally regarded as being dry as a chip, but thanks to the availability of ground water as well as dam storage, gardeners in Perth and most regional centres can still use sprinklers twice a week and hand-water anytime. The early provision of a desalination plant has helped as well.

On the other hand ...

On the other hand, South East Queensland’s market garden − the Lockyer Valley − (which usually looks green), goes in and out of periods where its underground aquifer sinks to record low levels, through the use of irrigation for the district’s vegetable crops. Salinity and soil degradation are side effects of this situation. The Lockyer Valley’s rainfall for the year to date is already 166mm below the long-term mean and only once in the last 10 years has annual rainfall been above the historic mean of 764mm.

Some Lockyer Valley settlements (Laidley, Rosemount, Plainlands), were preferred locations for early lifestyle refugees from Brisbane. Up the range from the Lockyer Valley lies the Darling Downs city of Toowoomba. It could be argued that Toowoomba, with its recent acrimonious referendum over the proposed use of recycled water, first brought the current water debate to the wider public. The city’s fast-growing population is the obvious wild card in a scenario where rainfall, especially for the year to date, is a long way below the long-term average. Toowoomba people will end up drinking recycled water one way or another.

Water use, rather than rainfall, is the key

Our research shows, however, that it would be a futile exercise to use annual rainfall patterns alone as a guide to buying property. Although there are some well-known trouble spots where annual rainfall figures have shown dramatic drops in some recent years, the long-term picture (since 1900) shows that over all, Australia’s annual rainfall has remained between 400 and 500mm p.a.

The big difference has been in water use. Department of Environment figures showed that Brisbane, the Gold Coast, Newcastle and Sydney have reached (and/or passed) the dates when their consumption of water exceeds the sustainable yield. Brisbane needs to cuts its per capita consumption from 183 kilolitres a year to 124 kl/yr by 2030, while the Gold Coast needs to reduce from 127 kl/yr to 78 kl/yr by 2030.

Ongoing population growth has increased the load on dwindling water resources in Sydney, Melbourne, Brisbane and South East Queensland generally. Recent signs that the government has realised the seriousness of the situation include plans to ban use of Murray-Darling River water for irrigation and Labor leader Kevin Rudd’s pre-election promise to loan money to Australian homeowners to become more self-efficient. And many local authorities offer incentives such as rebates to homeowners who install rainwater tanks (the Queensland Government offers rebates of up to $1000).

The looming Oasis Change

First we had the “Sea Change” buying jag, followed by “Tree Change”. The seemingly continuous stream of media stories about the “water crisis” is almost certain to introduce a “Oasis Change” factor amongst baby boomers looking to find a nice place to retire, or working families who just want to plant some cherry tomatoes and keep their cars and driveways clean. Lately, the Sea changers have been trying to find the right ambience in the one place, looking for opportunities in the beautiful (and wet) Northern Rivers region of New South Wales.

Clearly the Federal Government’s Water Minister Malcolm Turnbull believes there is abundant water in the Northern Rivers region, hence his recently announced plan to dam upper reaches of the Clarence River in NSW to supply water to drought-stricken south east Queensland. Turnbull also unveiled an option to dam the Tweed River and divert water to the Nerang River (to feed Queensland’s fast-expanding northern Gold Coast residential belt). Predictably, these announcements (seen by many as pre-election kite-flying), raised local ire and created colourful headlines (”Howard backs river raid”).

Large sand islands like Bribie and North Stradbroke have long been recognised as having a reliable source of good water. Both islands support permanent residential populations and large numbers of summer visitors and both islands have water treatment plants which provide water for residents and near mainland suburbs. Redlands Shire, adjacent to Brisbane, started taking water from North Stradbroke’s freshwater lagoons in 1990 and the resident sand mining company, Consolidated Rutile, has been using water a lot longer than that.

It has been estimated that up to 450 million litres of groundwater a day flows out to sea, so it is easy to see why in the early 1900s North Stradbroke was seriously considered as a water source for Brisbane (in those early days, the scheme was judged to be too costly).

At the micro-end of the water debate (Queensland’s Courier-Mail routinely sets aside at least 10 pages a week to cover the issue), thieves stole 12,000 litres of water from a Brisbane footie club grounds, just prior to the imposition of level 5 restrictions. Not quite ‘Apocalypse Now’, but an interesting reversion to primitive survival behaviour. The latest scare stories involve speculation about people having to be evacuated from southern Darling Downs settlements like Leyburn and Yangan (all such claims being hotly denied by local authorities).

Homebuyers who rate water security highly should seek out the towns and cities which either have no shortage of water and/or which manage their resources well. But beware; what looks green is not necessarily going to stay green.
 
The high rainfall/water tank areas

Maleny in the Sunshine Coast hinterland and neighbouring towns like Montville and Mapleton get, on average, over 2000mm of rainfall annually. Maleny and district has been going through a growth spurt as Brisbane pre-retirees and others drove up property prices to secure a lifestyle (while commuting to work by express train). Only a limited area in Maleny has reticulated water. Outer areas of Maleny and neighbouring towns have to rely on tanks and/or bores.  Montville and Mapleton are not on reticulated systems at all. This is seen as an advantage, because the area receives consistent high rainfall and water tanks are often overflowing.

Springbrook in the Gold Coast hinterland might be a beautiful place to live, but although it has very high rainfall, there is no town water and insufficient storage to support a larger population than it already has. Ironically, all of that rain (3000mm+ a year), runs down the mountains into the Hinze and Little Nerang dams to supply the Gold Coast. Nearby Mount Tambourine gets about half of Springbrook’s total – still plenty of rain – but also has no town water scheme, so local citizens rely on bores and tanks.
 
The “Wet Change” factor will probably deter people from considering rural towns perceived to be “dry” like Warwick or Goulburn, both of which have had to endure long-running droughts and tough water restrictions. Less logically, buyers will continue to look for homes in Brisbane and the Gold Coast, both in parlous danger of running out of water altogether through a lack of forward planning by successive State governments (all of whom actively encouraged interstate migration). Although the Gold Coast’s storage level is above 80%, comparing Hinze dam to the dams feeding Brisbane is like comparing a bucket to a bathtub.
No wonder they want to pinch water from Northern New South Wales.
 
Questions to ponder

Home buyers who are concerned about the future of the eastern seaboard cities and towns need to be asking these questions before buying property anywhere:
• What is the long-term water situation for the city/town?
• Does the property have rainwater tanks/bores?
• Is the property on town water?
• How secure is the town water supply?
• Is there sufficient groundwater to justify sinking bores?

Clearly if water security is a priority for you as a home buyer, you cannot depend on Australia’s notoriously variable climate or the short-term thinking of politicians. Instead you should do some basic homework on your preferred destination, which will quickly reveal current and historic trends. Installing rainwater tanks and the bigger the better is a quicker, cheaper and easier solution than waiting for dams, desalination plants or pipelines to be built.

ENDS

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