Please use the menu below to navigate to any article section:
Australia’s population is booming, with migration levels exceeding the peak of the mining boom.
And there are some regions in particular where popularity is surging.
Commbank and the Regional Australia Institute’s latest Regional Movers Index shows that there are 5 Australian regions where migration has exploded… by more than 200%.
Sea and tree-change shift is still in motion
First, the report reveals that overall, city dwellers are still flocking to regional Australia, likely thanks to more remote and flexible working patterns following the height of the Covid-19 pandemic era.
In the last quarter of 2022, migration from Australia’s cities to regional areas was largely unchanged from the height of the pandemic – and around 16% higher than pre-Covid.
But interestingly, while Australia’s appetite for regional Australia remains level, migration in the other direction – from regional Australia back into capital cities – has also picked back up.
The 5 LGAs where migration has exploded
The 5 regional LGAs with the largest increase in net internal migration are spread across the country – each of these LGAs saw huge three- to four-fold increases in net internal migration in 2022, compared with 2021.
Port Pirie came in first place with a whopping 347% increase in 2022, followed by Gladstone which enjoyed a 292% jump in its population.
Third was Murray Bridge (+245%), followed by Glenn Innes Severn (+241%) and then York (+238%).
While many of these areas had an influx of migrants from other regional areas, Glen Innes Severn in particular had a significant influx (159%) of migrants from capital cities.
Interestingly, York in WA saw a drop in the number of migrants coming from capital cities, with regional-to-regional migrants making up the remainder of the numbers.
By region, coastal Queensland continues to dominate the list of the LGAs with the largest migration inflows.
The Sunshine Coast topped the list, followed by the Gold Coast, Greater Geelong – the only LGA outside of Queensland to make the top five – the Fraser Coast, and Bundaberg.
The migration in each region was dominated by city dwellers too.
The data isn’t too surprising given we know that regional Queensland continues to be a favourite among Australians in search of more affordable property in lifestyle suburbs.
Where are our city dwellers moving to?
We can see the overall migration data points to five specific LGAs and regions that migrants are flocking to, but what about areas which are in demand from city dwellers in particular?
The report shows that the LGAs gaining the most people from capitals are major centres along the east coast which are close to capital cities.
The Gold Coast saw the largest influx of city dwellers, followed by the Sunshine Coast, Greater Geelong, and Lake Macquarie with 11.6%, 10.8%, 4.3%, and 3.5% of net capital to region migration respectively.
In fifth place is newcomer Moorabool – the sole inland LGA among the top five – with a 2.9% share of migration.
While these LGAs experienced the largest volume of net migration inflows from capitals in 2022 (among all regional LGAs), these flows were generally lower than in 2021.
Moorabool was the exception to this, with net migration inflows from capitals in 2022 more than double those of 2021.
But when it comes to the percentage increase in migration numbers from city dwellers into regional areas, the list looks very different.
In terms of the areas with a surge in popularity over the past year, Albany in WA came out on top with a nearly tenfold increase in its migration from the capital cities in 2022.
Gladstone in Queensland had 4 times as many migrants from capitals, followed by Mount Gambier in South Australia, Donnybrook-Balingup in WA, and Cairns in Queensland which each had 3 times the number of migrants over the same period.
Sydneysiders continue to flee
Sydneysiders continue to flee from the city even despite the pandemic waning and property prices tapering from their pandemic-induced peak in early-2022.
The report shows that capital-to-regional migration was dominated by Sydney – residents took the lion’s share of net outflows to regional Australia, at up to 74% (a steep increase from 53% that the city accounted for in 2021).
In contrast, net outflows from Melbourne were relatively steady at around 43%, and Adelaide’s outflow only increased by 1% to 6% in 2022.
But bucking the trend was Perth and Brisbane which actually saw a pickup in migration inflows during the year.
A word of caution
The impact Covid-19 had on Australia’s internal migration, and subsequently, population shift has been immense and it’s interesting to read about.
All cities recorded a sharp drop in their population while regional areas boomed with an influx of migrants searching for lifestyle suburbs and more affordable property.
While this data is interesting to read, and the shifts in numbers are extreme in some areas, these aren’t areas I’d recommend investing in.
In fact, I would avoid these locations for a number of reasons.
In the long term, there are more likely to be better opportunities for long-term capital and rental growth in “investment grade locations” in our big capital cities.
In fact, in the short term, it seems that the charm is fading in our regional markets.
CoreLogic reports that Australia’s COVID-induced whirlwind love affair with the country’s hottest regional cities has run its course with values declining sharply as vendor discounts climb and days on market blow out.
CoreLogic’s Regional Market Update, which examines Australia’s 25 largest non-capital city regions, shows 13 areas recorded an increase in house values over the year to January 2023, down from 21 over the year to October 2022.
And the country’s most popular lifestyle markets had been hardest hit by softer market conditions and rate increases.
It seems the large-scale population movements into regional locations has caused severe “growing pains” as there is a lack of infrastructure and amenity.
At Metropole, we always advise on the importance of investment-grade properties and locations, rather than chasing a hotspot or growth area.
But even before looking for the right location, make sure you have a Strategic Property Plan to steer you through the upcoming challenging times our property markets will encounter.
Because aside from remembering that you should focus your efforts on investment-grade properties and locations, you also need to remember that property investing is a process, not an event.
That means that things have to be done in the right order – and selecting the location and the right property in that location comes right at the end of the process.
The fact is, the property you will eventually buy will be the result of a sequence of questions you will need to ask and answer and a series of decisions you’ll need to make before you even start looking at locations.