Australia’s accelerating population growth underpins our property investment market

It’s a bit of a mystery to me why people are so keen to try to dismiss population growth as a key factor which underpins our major capital city property markets.

I mean, just take a look at last week’s numbers from the ABS:

December key figures

In the year to December 2012, the population of Australia increased by 394,200 people or 1.8%, which is way ahead of the long-term average of 1.4%.


Of course, population growth does not occur smoothly across the states.

In some states such as South Australia (+15,600), ACT (+8,600), Northern Territory (+4,200) and Tasmania (+400), the absolute growth numbers continue to be quite small. I don’t expect that to change too much.

On the other hand, take a look at what is happening in the states which house the major capital cities.

The population of WA is absolutely booming by 3.5% in the year to December 2012 or 83,000 people, so it’s little wonder that the Perth property market is flying.

And in Queensland (+92,500), Victoria (+99,500) and New South Wales (+90,400) the population growth continues apace.


People continue to head largely to the capital cities..

And so it’s little coincidence that over the past 12 months prices in Sydney (+4.61%) and Perth are smoking along (+7.8%).

Growth in Melbourne’s real estate markets has been a little more subdued (+2.12%) but then, why wouldn’t it be? Melbourne has, after all, experienced a quite phenomenal boom in prices since 2007.

It’s small wonder that we struggle to keep up with accommodation and infrastructure needs with population growth figures such as these reported today.


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Pete Wargent is a Chartered Accountant, Chartered Secretary and has a Financial Planning Diploma. He’s achieved financial freedom at the age of 33 - as detailed in his book ‘Get a Financial Grip – A Simple Plan for Financial Freedom’. Pete now manages his investment portfolio, travels and works as a consultant in the finance industry from time to time. Visit his blog

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