This is what will support our property markets in the long term

Demographics is one of the big drivers of our property markets.

Money manager Jeremy Grantham recently wrote that America has some of the best demographics in the world.

From now through 2050, America’s population is forecast to rise by 50 million.

China’s will fall by 101 million.population growth people city urban crowd

Russia’s will decline by 10.3 million.

Germany, down by 7.7 million.

Italy, down 1.1 million.

Finland, down 155,000.

Greece, 600,000.

But he left out Australia

Australia’s growing population will eclipse America’s growth and will be one of the key drivers of our property price growth.

You can see how many of us there are  at the Australian population clock –  there are currently over 23.85 million Australians.

This assumes growth on the following basis:

    • one birth every 1 minute and 42 seconds,
    • one death every 3 minutes and 34 seconds ,
[Imported] WP Advertize it Free Strategy ad 10 July 2014 (Desktop #44800)
  • a net gain of one international migration every 2 minutes and 14 seconds, leading to
  • an overall total population increase of one person every 1 minute and 20 seconds .

ABS Demographic Statistics show that in the 2013-14 financial year, Australia’s population grew by 1.6% (365,000 people)
Sure it takes more than population growth to fuel our markets but it’s an important growth driver and while the in USA their population is forecast to grow by 50 million by 2050, some estimates suggest Australia’s population could close to double in that time.

In fact at current growth rates the population of Melbourne and Sydney will increase by around 10% in just over 5 years.

Now that’s a strong growth driver for property markets.

Some interesting graphs

Motley Fool provided some great graphic representations of population growth around the world.

Here’s how America ages over the next few decades.

Their young working-age generations grow, even as baby boomers retire:

Usa

Compare that to China.

Its older generations swell, then die, leaving a shrinking population and collapsing workforce.

China

South Korea is pretty awful, too.

Koreaanim

Japan is a retirement community.

Japan



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About

Michael is a director of Metropole Property Strategists who create wealth for their clients through independent, unbiased property advice and advocacy. He's been once agin been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au


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