ORANGE real estate agents warn the closure of Electrolux will deliver a blow to the Orange property market, but the city should recover quickly.
McCormack Barber real estate agent Rob Nevins said Orange’s reputation as a property hotspot was quashed when the construction of Cadia East wound up and contractors left Orange, so the reduction in a workforce of 544 from Electrolux wouldbe noticed.
However, it is not going to impact negatively for the long term.
“Orange is very resilient,” he said.
The median price of an Orange house stands at $325,000, reflecting a 5.4 per cent gross yield,according to RP data.
Units sell for an average of $225,000, reflecting a 6.1 per cent gross yield.
Mr Nevins said the majority of the workforce at Electrolux either rented or had owned their own home for a long time.
He said because there had been rumours of the plant’s closure for the last few years, people had made attempts to get mortgages down to a manageable level.
He said people in the “prime time” of their working life may find it difficult, having to sell and leave Orange.
“People have had time to prepare and in the next two years I think we’ll see a gradual reduction in the workforce ... it won’t happen overnight,” he said.
Ray White principal Libby Seaman said the rental market would continue to suffer and the job losses would not impact on property sales greatly.
She said there were currently about 300 vacant properties for lease in Orange.
The rental vacancy rate has increased from below 2 per cent in November 2011 to 4.2 per cent in September this year.
“The rental market is pretty hideous at the moment,” Ms Seaman said.
She believes the majority of Electrolux workers rent and expects the market to take a further hit in 2016, but says there is hope another industry will take over the factory.
“We’ve seen a drop of $5 to $10 to $20 every week because there are so many properties on offer, people can negotiate a price ... we’ve seen houses two years ago going for $550 per week and are now down to $420 per week,” she said.
“It’s been an adjustment to say the least.”