The latest RPData figures show that the Melbourne property market is going gangbusters. Dwelling prices increased 2.4% over the month of September and 5% over the last quarter.
Property values increase due to a combination of increased demand (in certain suburbs) at a time of increasing confidence and low interest rates.
Where did the demand come from?
It came from the 102,000 new people who chose to call Victoria home over the last year. That’s about how many squeezed into the MCG last weekend for the AFL grand final.
If you think about it, that’s 2,000 new residents a week coming to Victoria (mainly Melbourne) and that’s great for the economy and good for the property market.
This equated to an increase of 1.82 per cent in the year to March – the biggest growth of any state, and a large part of this was from overseas migration.
Victoria’s population grew to 5.713 million in March, and if it keeps growing at this rate, it would top 6 million at the start of 2016.
It has added more than a million people since 2000, and on current rates, will add another million by 2021.
This means Melbourne’s population is on track to rise from 4.25 million in mid-2012 to 4.5 million by 2015 and 5 million by 2020. By the end of next year, it will have grown 30 per cent in just 15 years.
What about the rest of Australia?
Overall Australia’s population grew by 397,000 or 1.76 per cent, to pass 23 million in March. The ABS estimates net overseas migration to Australia in the year to March was 238,300.
At this rate, Australia would have 25 million people by the end of 2017 – with the last 5 million added in just 13 years.
Western Australia had the fastest state growth. Its population rose by 3.4 per cent to just under 2.5 million people at the end of March. Perth is set to pass 2 million this year.