The council has given the green light to begin investigating land and funding options to build the units, which at this stage looks likely to be six two-bedroom dwellings.

Cr Donald said the shire plans to reach out to its neighbours, including Dubbo, Parkes and Gilgandra to help look at options for the long-term management of the proposed development.

The proposal, once off the ground, could pave the way for additional dwellings to be built.

Cr Donald said the council would look at similar types of developments around the region - taking into account the type of dwellings being constructed and also whether they would be rented or bought off the plan.

He said demand would drive expansion beyond the first six units and he had not ruled out more nursing and aged care facilities in the future.

It is understood council is looking at two potential sites to develop the units. However, it is not clear at this stage how much the development will cost.

A final decision will be made in the coming weeks.