Population growth is a key indicator for the future of property prices. As more people move into an area, there is usually more competition on properties for sale and rent and this naturally pushes prices up – as long as the supply remains relatively constant.
The Australian Bureau of Statistics has just published a comprehensive regional breakdown of population growth across the country, with the fastest growing population hot spots in each state and territory identified for the year to June 2011.
If you’re looking to invest, choosing a high growth location is a smart idea but remember to always check the supply side, as some areas have a rise in population simply because a lot of new stock (usually apartments) has become available, thus drawing new residents. The supply/demand balance is very important because it’s not uncommon to see high supply markets experience little capital growth because the rising population is simply filling in readily available, vacant new stock rather than pushing up prices on existing stock.
Taking an umbrella view, Australia’s population grew by 1.4 per cent to 22.6 million over the year to June 2011. Capital cities grew by 1.6 per cent, with Perth leading the way up 2.5 per cent to 1.74 million followed by Canberra up 1.9 per cent to 365,240 and Brisbane up 1.7 per cent to 2.07 million.
Regional areas grew by 1.2 per cent, with the southwest region of WA experiencing the fastest growth at three per cent followed by the Pilbara and the Kimberley also in WA. Also among the fastest growing regions was the Gold Coast, up 1.8 per cent. The Gold Coast is a classic example of an area experiencing solid population growth that is not translating to higher property values due to a local market oversupply and poor local economic conditions.
Here are the top five population hot spots in each state and territory. These Local Government Areas (LGAs) experienced the fastest rate of population growth in the year to June 2011.
*SLAs (Statistical Local Areas) with the highest number of new persons (LGAs with the fastest growth rate not available)
If you’re looking to invest, take note of these rapidly growing locations but bear in mind that some locations may not necessarily suit long-term investment, such as mining towns that are solely reliant on that one industry to survive. As always, do your research.
Important information: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.
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