Regional migration remains strong, with millennials driving the trend

Scott Kuru July 19, 2024 5 min read

KEY POINTS

In the first quarter of this year, regional migration clocked the fifth highest rate of regional migration from city centres in the past six years
Millennials are moving to the regions more than any other generation
Regional house prices are experiencing growth due to increased demand

Regional migration continues to dominate Australian housing trends, with city-dwellers led by millennials leaving Sydney and Melbourne in droves, according to a new report released by the Regional Australia Institute (RAI).

Regional Migration (1)

The first quarter of this year has notched the fifth highest rate of regional migration from city centres in the past six years, up 20 percent compared to pre-covid times, according to the report.

However, despite internal migration in recent years being attributed to the COVID-19 pandemic, this ongoing trend is now far more entrenched.

Not just a fleeting trend

According to RAI CEO Liz Ritchie, the figures paint a clear picture—the regional migration initially fuelled by the pandemic is not just a fleeting trend but rather a lifestyle choice becoming increasingly popular.

“People are voting with their feet and making a very conscious decision to live in regional Australia. Whilst the pandemic supercharged this movement, the regional lifestyle is continuing to prove highly desirable for thousands of people, especially those from cities,” Ms Ritchie said.

“This movement in population can no longer be seen as a quirky flow-on effect from the lockdown years. A societal shift is underway.

“This sustained trend provides tangible evidence regarding the importance of investing in and supporting the regions to ensure communities have the services, skills, and infrastructure they need for their growing populations.”

Increased mobility across the country might be due to a range of factors: shorter commute times, a quieter lifestyle, and greater affordability.

Whatever the reason, one generation in particular is seeing the value—and that’s millennials.

Millennials are moving the most

Millennials (people born from 1981 up until 1995) are making up the lion's share of the mass exodus, accounting for the majority of movers from every capital city. This generation lead the influx of city-dwellers to regional areas in all of the capital cities.

In Brisbane alone, millennials made up 51 percent of all people moving to the region and 7.3 percent in Sydney.

In Hobart, millennials were responsible for 17.4 percent of regional moves, and in Darwin, they made up 27.8 percent of moves to the regions.

The demographics driving this trend suggest what’s long been suspected - that the move to the regions is widely fuelled by housing affordability or the lack thereof in Australia’s capital cities.

House prices are the driving force

In the four years from March 2020 to March 2024, Australian house prices rose by 32.5 percent, adding a whopping $188,000 to the median house price.

Housing costs are proving to be a barrier that young families within the capital just can’t seem to overcome.

Commonwealth Bank Regional and Agribusiness Executive General Manager Paul Fowler said millennials are instead opting for regional centres with generous employment prospects.

“This quarter’s report paints the picture of younger individuals or younger families looking for somewhere that's more affordable. Many are opting for the large regional centres which are buzzing with business activity and investment, offering a great range of employment opportunities,” Mr Fowler said.

It only takes a quick look at current house prices in the capitals and the outer suburbs to understand the exodus.

Cities like Sydney are evidently out of reach for most first-home buyers, with the median house price currently sitting at $1.63 million. Areas like Sydney’s Northern Beaches are even more inaccessible for those looking to secure a first home, with the median house price an eye-watering $2.6 million.

It’s making the Gold Coast’s $1 million median property price an extremely attractive option, cementing the region as one of the top choices for movers from every capital city.

Young families uprooting in pursuit of a better quality of life

Katie Mahoney, 31, saw the value that the Gold Coast could offer, moving her young family to Coombabah from Narrabeen on Sydney’s Northern Beaches just last year. She notes that employment prospects and property prices were the driving factors in their decision.

“The major reason for making the move to the Gold Coast was all about rising property prices,” said Katie.

“For my family, despite being on what you would consider a healthy combined income, it was becoming increasingly obvious that the dream of owning our own home in Sydney that would be big enough for our growing family was becoming a distant possibility.

“Unfortunately, with the cost of living and current interest rates, we couldn’t afford to own our own home and maintain a decent quality of life in Sydney, which drove us to look up North.”

While affordability influenced their move, Katie notes that the Gold Coast is experiencing high-value growth, too, yet still provides room for families to enjoy a better lifestyle.

“Despite the fact rising property prices have also affected the Gold Coast, it's not currently at the same rate as Sydney, although that is now changing.

“Choosing the Gold Coast meant we could afford to purchase a home and also maintain a lifestyle, allowing us to still take family holidays and not work overtime every week just to cover our mortgage,” said Katie.

Regions experiencing heightened growth

The continued traction that the regions are experiencing has meant higher demand, propping up house prices.

In the three months to April, regional dwelling values rose 2.1 percent according to CoreLogic. This marks the fastest quarterly growth rate in almost two years and outpaces capital city growth at 1.7 percent.

In the past 12 months alone, the combined regions clocked 7 percent of value growth, with Regional QLD, SA, and WA leading the charge.

However, even with the recent growth in property prices, in most cases, the regions still provide an affordable alternative to the overpriced and overrun capitals.

For Katie, the Gold Coast was the obvious choice but not the easiest one.

“For the majority of us in our 30s and 40s, the last few years have probably been a wake-up call that it's extremely tough to live the lifestyle you want and own your own home in Sydney.

“Which is a sad reality, having to realise this and make the tough call to move away from your hometown,” said Katie.