What a difference a mining boom, an earthquake and Chinese investment make.
The fortunes of Australia’s cities and towns are unusually connected to these trends and events. I have compared the rate of population growth across the 100 largest towns in Australia between the 2010 and 2015 financial years, which straddle the rise and fall of the mining boom as well as the 2011 Christchurch earthquake and subsequent construction boom that has all but reversed the cross-Tasman migration of New Zealanders. I’ll come to the China effect later.
The Australian Bureau of Statistics released estimates of population growth for the 2015 financial year in April. The database relates to significant urban areas that might be simply described as the contiguous urban area. This means that for larger towns and capital cities outlying commuter towns are measured as separate urban centres so that Sydney’s population (4.5 million) in this dataset excludes the Central Coast (325,000) and other outlying settlements that are otherwise wrapped up into a metropolitan population of close to five million.
Between 2010 and 2015 Australia’s rate of population growth dropped from 377,000 to 317,000, which reduced the percentage rate of growth from 1.7 per cent to 1.4 per cent.
The issue for Australia and for the property industry is that this diminution in growth rates has not been spread evenly across the continent. Since housing demand is inextricably linked to population growth this is an important issue. In a normal distribution a 0.3 percentage-point drop in population growth over five years should gently reduce demand for housing across the urban hierarchy. Not so. Some towns have boomed; others have, to put it mildly, ground to a halt.
Let’s start with the happy numbers in our largest cities. The growth rate for Sydney and Melbourne has increased over the last five years despite a drop in the national growth rate. Both cities lifted annual growth from 1.8 per cent to 2 per cent for Melbourne and from 1.4 per cent to 1.7 per cent for Sydney.
Our two biggest housing markets have strengthened during and beyond the mining boom. And that’s because internal migration has drawn labour from the frontier states and also because of the China migration effect. China is now the largest source of inflowing migrants to Australia; this segment much prefers Sydney and Melbourne to other cities.
For the rest of this article, click here: http://www.theaustralian.com.au/business/opinion/bernard-salt-demographer/seachange-and-china-drive-pace-of-australias-urban-growth/news-story/c079ff30d32f7781d5c4bf898ed3cecd