Armidale Regional Council CEO Susan Law said Armidale is still using about 220 litres per person per day, which is a figure that needs to drop and is a cause for concern to council.

"Our situation at the moment is pretty grim. We have now identified 'day zero', the day when the region will run out of water if we don't get any significant rain and runoff. It's actually at the end of October 2020," she said.

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"Armidale water restrictions will go to Level 5 in January next year.

"Residents changing their water use and reducing their water consumption is the single biggest thing we can do to make a difference right now that we can control."

Mrs Law said council would really like to see the daily usage rate drop to 160 litres per person.

"That's [a reduction of] about six buckets full per person per day," she said.

"We are still well above the State average, and the Victorian state usage criteria is 155 litres, even when there is no drought.

"I think one of the things we're having to get our head around is the fact that we do have a drought situation here in the Armidale region. It is not something people, particularly in Armidale city, are used to.

Mrs Law said she thought the city still held onto an attitude of being invulnerable to drought.

"We are very much in drought," she said.

"Day zero isn't all that far away, so we have to take all the actions that we can to eke out all of the water we have.

"We now have a hydrogeologist on board, and he's about to start work looking for groundwater that might be of sufficient quality and quantity for us to use for domestic purposes only."

Level 5 water restrictions mainly affect businesses. Mrs Law said council would reduce, and in some cases stop, supplying some businesses to conserve water for residents and domestic use.