Booming population growth

Booming population growth in Victoria is generating solid underlying demand for urban housing, with inner Melbourne riding a very strong growth trajectory.

Latest Australian Bureau of Statistics data shows that Victoria’s population increased by 108,757 people over the 12 months ending March this year – the highest rate of growth of all the states except Western Australia.

Of this upsurge, 61,923 were overseas migrants with 19,514 arriving over the March quarter alone. Migrants from interstate accounted for 8367 over the year to March. The March quarter total of 2468 interstate arrivals was the highest quarterly total ever recorded by Victoria in the ABS survey.

Denise Carlton, the ABS’s director of demography, says a population surge of more than 108,000 people is like adding close to the population of Darwin to Victoria.

She says net overseas migration was the main contributor to Victoria’s population growth, accounting for 57 per cent of the state’s growth. “Notably, the net overseas migration contribution to Victoria’s growth is below the Australian rate of 60 per cent, which highlights the recent increase in net interstate migration to the state,” she says.

More than 90 per cent of new arrivals to Victoria choose to live in Melbourne.

Melbourne’s inner-city areas, in particular, are a popular magnet for newcomers because of quality infrastructure and transport networks.

The Australian Government has been running a record-high migration program since 2010.  Monash University’s Centre for Population and Urban Research (CPUR) says that just over half of the migrants being issued visas are locating in Sydney and Melbourne.

CPUR studies show that Melbourne has received a disproportionate share of overseas and interstate migration since the early-2000s. This has occurred partly because Melbourne offers a good availability of dwellings, but also because houses here are cheaper than in Sydney or south-east Asia.

The research centre says there is a large flow of new households coming into the Melbourne housing market, which is increasing competition for established houses and units.

Another trend that is benefiting inner urban property values is the growth in the number of baby boomers and young professionals relocating from Melbourne’s middle-ring and outlying suburbs to the inner city. Issues such as increasing traffic congestion and demand to be close to workplaces and lifestyle and entertainment attractions are propelling a broad range of demographic groups to opt for inner-city living.

Compared with 100 years ago, Australians today are older, and are more likely to live in urban areas and have fewer children.

According to the ABS’s most recent census, in 2011 over 85 per cent of Australians lived in urban areas and nearly 70 per cent lived in our capital cities, continuing Australia’s post-World War II tradition of being one of the world’s most urbanised countries. In contrast, 100 years ago less than 40 per cent of Australia’s population lived in our capital cities. At that time, Melbourne was our largest city, with just over 500,000 people.

Now there are an estimated 4.4 million people living in Greater Melbourne, accounting for 76 per cent of Victoria’s population. The population in Greater Melbourne increased by 416,500 between 2008 and 2013, which equated to 86 per cent of Victoria’s total growth in that period.

Australia is closer to having 24 million people than 23 million, according to the Australian Bureau of Statistics’ population clock.

In the five years to 2013, Victoria had the largest population growth of all states and territories, with an increase of 483,000 people.  Melbourne’s population is projected to increase continuously and reach up to 9.8 million in 2061.