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Wednesday, 27 September 2017

Build, and they may come

Immigration picks up

The 2016 Census showed that Australia still has an ageing population, and the number of deaths continues to rise to record highs, in turn meaning that the natural increase in the population has been slowing. 

The ageing of the population has been combated through the immigration programme, which is largely - if not exclusively - tilted towards younger migrants into Australia.

While new government figures show that 457 visa issuance is falling, student visas are recording double digit rates of growth, and now sit at the highest level on record.

The rising tide of international students will largely impact the inner suburbs of Melbourne and Sydney. 

And annual net overseas migration has really picked up the pace over the past six quarters, up by +30 per cent to +231,890 in the March 2017 quarter. 

This surge in net overseas migration has pushed the annual national rate of growth in the estimated resident population back up to +1.6 per cent or +389,072. 

Population growth in the seasonally strong March quarter was particularly stark in 2017 at +126,138. 

Headcount growth remains a bit below the rate of growth seen during the headiest of the mining boom migration years, but is nevertheless very strong.

Apartment glut picked off

Moreover, there's a concentration issue afoot, with immigrants overwhelmingly heading to three main regions: Sydney, Melbourne, and south-east Queensland. 

Internally, migration continues to take folks away from Sydney (nothing new there, it's been happening for decades).

Some Sydneysiders are taking their boosted equity out to regional New South Wales - especially to the South Coast and to the Hunter - and others are heading north to Queensland.

Western Australia, Northern Territory, and South Australia continue to lose residents at a concerning rate, with internal migrants largely headed to Melbourne (for jobs) or south-east Queensland (for climate, lifestyle...and, well, hopefully a job).

A smattering of interstate migrants are also bound for Hobart and Canberra. 

The net result has been to send Victoria's annual population growth steaming up to a gold-rush-like +149,374 or +2.43 per cent, which is a staggering rate of growth, and renders predictions of a Melbourne dwelling oversupply meaningless, at least until population growth slows. 

From a year earlier, growth in the estimated resident population has also accelerated very strongly in New South Wales (+123,296) and Queensland (+75,372).

The capital cities account for the great bulk of the population growth in the two most populous states, and somewhat less so in Queensland's case. 

Annual population growth appears to have steadied in Western Australia, after some downward revisions to previous estimates. 

Build, and they may come

With the ageing of the population and an accelerating 'death bust', if that's not too dramatic a term, growth in headcount has become much more focused on net immigration than natural increase. 

It's interesting to note that the sharp increase in the estimated resident population over the past 18 months has largely impacted the apartment construction hotspots of Sydney, Melbourne, and Brisbane. 

A high number of apartment completions are expected in 2017, yet with the estimated resident population increasing by more than 126,000 in the first three months of the calendar year alone, the assumed apartment glut may not deliver the jolt previously anticipated.