It's doubtless confusing for budding property investors given that one section of the property market commentariat instructs you to invest for cash flow or yield in regional properties, arguing that in the future people will shun capital city living in of electing to work from home and live in cheaper regional areas.
And on the other hand, there are those - including myself, in fact - who are adamant that over the long run, the greater capital growth will be sourced at lower risk in the capital cities.
The assured huge population growth in capital cities and a limited supply of land will ultimately drive land values to the very limits of affordability, and at various points in the property cycle, beyond them.
I didn't arrive at this conclusion by accident by the way, rather that I've seen how it all plays out before in Britain when the debt cycle eventually reverses with gusto.
By way of disclosure, I do own some regional properties, but I believe that the core of a property portfolio should be founded upon the specific capital city property types which will be in massive demand regardless of what's happening to the economy or property markets on a macro level.
When it comes to finance, investment or economics, whenever in doubt about who to believe, always remember W. Edwards Deming's simple mantra: "In God we trust. All others must bring data."
Today, let's look at some demographic shifts. Last week, the ABS Regional Population Growth data reported that in the year to June 2013, Australia's population increased by a hugely strong 407,000 to 23.1 million, but where exactly did all that growth happen?
The sea change phenomenon is dead
Regular readers of this blog over recent years will know what we've long expected to see in terms of population growth trends.
Very specifically, that is, as two-thirds immigration of Australia's population growth becomes accounted for by immigration and only one third of it occurring through natural growth, the respective populations of our four major capital cities in particular (but not Adelaide) are set to be bursting at the seams with growth.
Cameron Kusher of RP Data was quick off the mark in analysing the recently released figures from the ABS on Regional Population Growth, and the conclusion was crystal clear: "The sea change is well and truly buried"...for now at least.
You can read Kusher's analysis here on Property Update and his two charts copied below summarise it rather well - the capital city population growth growth rate (+2.1%) is miles ahead of the now lagging regional areas (+1.2%), with all four of the major capital cities expanding at a tremendous pace.
Adelaide's labour market has been declining for the past year and correspondingly the pick-up in population growth has reversed.
But what does this mean for property investment? Well, not higher prices directly, but intense pressure on land prices in certain popular city areas, and a consistently compounding growth in demand over time.
State level - New South Wales
Wollongong added 3,000 persons in the year to June 2013 (+1.1%), Newcastle-Maitland +4,800 persons (+1.1%), the Central Coast +2,700 (+0.8%) and Albury +1,300 (+1.5%), all thereby recording population growth rates of well below the national average of 1.8%.
Dubbo, Ballina, Batemans Bay, Bowral-Mittagong, Broken Hill, Coffs Harbour, Forster-Tuncurry, Goulburn, Grafton, Lismore, Lithgow, Muswellbrook, Nelson Bay, Parkes, Port Macquarie, Tamworth, Taree, Ulladulla and Wagga Wagga.
Compare this, for example, to Sydney's blistering population growth of 81,000 in the year to 30 June 2013.
The aforementioned Queensland hubs of the Gold Coast and Sunshine Coast also feature here, of course.
However, at 2-3 persons per household, it's naturally more manageable and realistic for a regional city to absorb such levels of population growth via land release and new developments, which in turn may dampen the potential capital growth in existing dwellings.
Together, Greater Sydney (+81,000 or +1.7%) with a population of 4,757,000, and Greater Melbourne (+95,000 or +2.2%) with a population of 4,348,000, are home to two out of every five Australians, with immigrants flocking to these two cities in droves.
Greater Brisbane +45,000 (+2.2%) and Greater Perth +67,500 (+3.5%) also demonstrated exceptionally strong growth.
However, Greater Adelaide's population growth was comparatively very weak in 2013 at only +13,000 (+1.0%) as was that of Greater Hobart +1,000 (0.5%). For completeness the 2013 growth in Greater Darwin was +3,900 (+3.0%).
As a general rule I don't listen to the property experts who recommend investing in the southern states or obscure regions since they so often have a vested interest in advising people where to invest. Instead, when trying to project into the future, I simply listen to what the actual data is telling us:
"The proportion of people living in a capital city is projected to increase from 66% in 2013 to 72% in 2053. In 2053, 89% of capital city residents will live in the four largest capital cities." - very conclusive.
Meanwhile Greater Sydney accounting for a massive 78% of the state's population growth in the 12 months to June 2013, with the whole of the rest of the state adding only a meagre 22,300 people in the year.
Where a lot of people tend to misunderstand data (including, on occasions, city planners) is that they assume a growth of 1.8% this year has the same impact as 1.8% a few years hence.
But it isn't, due to the compounding growth effect (click chart).
One wonders whether the percentage growth rate will be forced to slow as the property cycle moves into its next stage.
For if Greater Sydney continues to grow at its present rate the population will surpass 6 million in only 13 years time, with an infrastructure all set to buckle under the strain.
Below is the New South Wales map.
We can safely ignore the incongruous, amorphous blob of red on the west of the state since that relates to just a handful of extra persons in Orange.
Indeed, the population growth is so heavily focused on suburban Sydney, that this map is effectively useless and we'll need to zoom in further.
I know precisely where I'm planning to own property for the next 30-40 years. How 'bout you?