The latest ABS statistics confirm that Australia produced its highest rate of population growth since the mass migration era of 1950’s and 1960’s.
The record-breaking 634,479 population growth (a 2.4 percent increase) for the 12-months to June 2023 made up for 2021’s lowest population growth rate in more than a century.
After population declines of 25,116 and 81,418 in Sydney and Melbourne just 2-years ago, they produced growth of 146,705 and 158,907, respectively, last year.
The combined population growth of Australia’s two biggest cities in just 12-months was enough people to establish an entire city the size of Geelong, Australia’s 10th largest city (founded back in 1837).
Population booms
Different pockets within capital cities and regional had population growth rates in 2023 which were well above the national average of 2.4 percent.
Examples of such municipalities include Melton VIC (6.6 percent), Camden NSW and Yarra VIC (5.5), Kwinana WA (5.2), Maribyrnong (4.7), Randwick NSW (4.5), Logan QLD (4.1), Augusta Margaret River WA and Mitchell VIC (3.9), Parramatta NSW (3.3), Whitsunday QLD (3.1), Mount Barker SA (3.0), Lockyer Valley QLD (2.9), Moreton Bay QLD (2.7), Cessnock (2.6), Fraser Coast QLD and Maitland (2.5).
Whether from overseas migration or existing Australians relocating to a different city (referred to as ‘internal migration’), there are very different patterns from city to city.
The truly unique graphic below contains an interesting comparison of six (6) different cities, state capitals and regions, from six (6) different states.
Overseas migration
For several years leading up to the pandemic, Australia typically had a net annual intake from overseas migration of 240,000. The 3 financial years which were affected by the international border closure produced a combined intake of just 260,000.
Australia’s net overseas migration in 2022/23 was an all-time record high 528,421.
When closely examining the ABS data, one of Propertyology’s observations was the connection between proximity of major universities and the highest rates of population growth last year.
Melbourne City (10.6 percent) had the highest population growth rate in Australia in 2023, while other municipalities with a renowned high presence of international students with very strong population growth include Perth City (7.4), Sydney City (5.9), Adelaide City (6.6), Monash VIC (4.3) and Gold Coast QLD (2.9).
Official data confirms that more than half of all overseas migrants do not buy a home until being in Australia for at least 5-years.
Regardless of overseas migration volumes from year to year, 93 percent of real estate buyers are existing Australian residents.
To smooth out the data volatility from the pandemic, we assessed the contribution of overseas migration to population growth of every township over the last 5-years.
For perspective, net overseas migration was directly responsible for a 5.1 percent increase to national population over the 5-years ending June 2023.
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At an individual township level, the biggest beneficiaries of overseas migration were Sydney (7.8 percent), Melbourne (7.3), Griffith (5.7), Adelaide (5.6), Perth and Newcastle (5.5).
Aside from having a ‘big city’ profile, there is a distinct pattern of overseas migrants being drawn to ‘food bowl’ communities, tourism towns and university precincts.
Other big winners include Byron, Gold Coast and Murray Bridge (5.4), Armidale (5.3), Launceston (4.8), Whitsundays (4.7), Brisbane (4.6), Wollongong (4.5), Canberra (4.4), Warrnambool and Renmark (4.1), Hobart (4.0), Margaret River (3.9), Cairns, Queanbeyan and Lockyer Valley (3.7), Mildura and Shepparton (3.6)
Internal migration
Historically speaking, Sydney and Adelaide have been consistent ‘population loses’, Brisbane has consistently been a ‘population winner’ and the other 5 capital cities are renowned for fluctuating either side of ‘neutral’ depending on the quality of their city’s economic conditions.
348,824 (net) relocated away from capital cities to various regional locations over the 17-years since July 2006. That’s enough people to create an entire region the size of Sunshine Coast.
Over the last 5-years, the total population decline from internal migration in Sydney (180,684) and Melbourne (82,184) is equivalent to cities the size of Toowoomba and Coffs Harbour, respectively.
Of the biggest ‘population winners’ from internal migration over the last 5-years, Victoria absolutely dominated with 5 of Australia’s Top 10.
They were Bass Coast (12.5 percent), Mitchell (11.2), Surf Coast (10.3), Baw Baw VIC (9.6) and Mansfield (9.0).
Geelong (6 percent), Ballarat (5.5) and Bendigo (3.4) were other Victorian locations which significantly benefitted from internal migration.
The most common drivers of internal migration include a pull towards natural lifestyle attractions, reduced congestion, employment opportunities, shorter work commute times and housing affordability.
South Australia: Yankalilla (9.7 percent), Alexandrina (8.3), Copper Coast (8.0), Victor Harbor (4.1), and Mount Barker (3.1).
Queensland: Fraser Coast (8.8 percent), Sunshine Coast (8.2), Gympie (6.7), Livingstone (6.2), Scenic Rim (4.8), Gold Coast (4.1), Bundaberg (4.0) and Lockyer Valley (3.7).
Related article: Coastal versus inland property market facts
Tasmania: Latrobe (8.6 percent), Glamorgan (7.7), Break O’Day (6.4), Huon Valley (5.8).
New South Wales: Maitland (8.6 percent), Port Macquarie (8.1), Shellharbour (5.8), Eurobodalla (5.0), Ballina (4.2), Grafton (4.1), Bowral (3.0) and Albury (2.5 percent).
Western Australia: Augusta-Margaret River (8.8 percent), Mandurah (6.9) and Busselton (6.7).
A $940,000 reason not to obsess about population growth
Countless evidence-based reports produced by Propertyology over the years contain indisputable proof that, while population growth has some influence on real estate value fluctuations, the degree of influence in the overall scheme of things is relatively minor.
Case Study [20-years ending June 2023]
- Sydney’s population increased by 1,287,922 (31 percent), compared to Launceston’s population growth of just 13 percent.
- While it took Launceston 20-years to add 8,093 to its population, Sydney saw that gain on an average of every 6-weeks.
- The median price of a Sydney house went from $425,000 to $1,310,000 (an average annual rate of 8 percent) and median apartment prices from $355,000 to $750,000 (a very below par 3.8 percent).
- Launceston’s property market significantly outperformed Sydney, with an 8 percent average annual increase in house prices
- For the same price of one (1) Sydney house in 2003, four (4) Launceston houses could have been purchased.
- Injecting the same amount of capital into Launceston real estate in 2003 would have added an extra $940,000 to one’s net worth than investing in Sydney over the 20-year period.
- The combined annual cash flow from the 4-standard houses in Launceston would have been significantly higher than the one Sydney property.
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