Key takeaways
This is a scorecard of Simon Kuestenmacher's demographic predictions from a year ago.
While the world feels increasingly chaotic, long-term trends like ageing, urban expansion, and migration remain surprisingly stable and easier to forecast. This makes them invaluable tools for investors planning years ahead.
Despite planning intentions to encourage inner-city density, affordability and scale still favour outer-suburban greenfield developments. These areas will continue to absorb the bulk of population growth, driving demand for housing and infrastructure.
With fewer babies being born and people starting families later, population growth will rely heavily on migration. Investors should expect continued strong demand in migrant-heavy areas and plan around shifting household formation patterns.
Low unemployment and high workforce participation, especially from women and older Australians, are structural trends, not temporary blips. This keeps upward pressure on wages and has implications for business planning and consumer spending.
Simon’s success rate (13 hits, 4 maybes, 3 misses) shows that thoughtful demographic forecasting offers a clear edge. For investors, the key is to base decisions on long-term fundamentals—not short-term media noise.
Every week, we’re told the world is becoming more chaotic: wars flare up, inflation spikes, political trust erodes, and new technologies promise to upend everything.
It’s no wonder people feel that planning for the future, especially when it comes to property investment, business, or wealth creation, is harder than ever.
But if you know where to look, there are stable, slow-moving forces shaping the future with surprising reliability. That’s the power of demographics.
They don’t scream for attention like the headlines, but they underpin virtually everything that matters to long-term investors: population growth, housing demand, economic shifts, and consumer behaviour.
That’s why I found it so refreshing leading demographer, Simon Kuestenmacher, recently did what few experts ever dare: he marked his own forecasts from the year before, and aired them in our latest Demographics Decoded podcast
No hiding behind vague language, no moving the goalposts, just a clear-eyed look at what happened, what didn’t, and what that tells us about how to prepare for what’s next.
For weekly insights subscribe to the Demographics Decoded podcast, where we will continue to explore these trends and their implications in greater detail.
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What Simon got right (and why it matters)
1. Third-party politics is here to stay
Simon correctly predicted the continued decline of the major political parties.
At the last federal election, more than 34% of Australians voted for minor parties or independents, a dramatic rise from just 2% in 1987.
Of course, trust in the 2 major parties has fallen significantly since.
And this matters to investors and business owners because political fragmentation can mean less certainty, slower reform, and more reactive policy.
It’s also part of a broader trend of institutional trust breaking down, a reminder that we can’t rely on government policy alone to solve housing affordability or infrastructure gaps.
As Simon put it:
“There’s no sign people are returning to the major parties.
In fact, our compulsory and preferential voting system probably prevents us from swinging wildly from left to right as some other countries do, which ironically gives Australia more political stability than we often give it credit for.”
2. Falling fertility rates
This was one of the easier predictions, but no less important. Australia’s total fertility rate continued its steady decline.
Fewer babies are being born per woman, largely because people are delaying family formation and feeling less financially confident about raising children.
The demographic mechanics are simple: more women are pursuing tertiary education and careers, pushing first childbirth into their 30s. That narrows the window for having multiple kids.
But the implications are profound as it means we’re going to rely more and more on migration to grow our population. That in turn reinforces demand in key urban markets, particularly where migrants settle first.
3. Greenfield development outpaces infill
Urban planners may favour denser, inner-city housing, but the market is telling us a different story.
As Simon correctly forecasted, greenfield developments on the urban fringe outpaced infill projects because building on raw land is still about half the cost per square metre compared to medium- or high-density construction in established suburbs.
And when you're trying to house an additional 350,000 people per year, speed and cost win.
This is especially true given the long timelines and planning hurdles for inner-city development.
4. Australia is getting older
No surprise here, but still important: our median age is climbing.
Even with strong migration intake, we’re not importing enough youth to offset the demographic drag of our ageing population.
This will reshape everything from the types of homes people want (think downsizing, accessibility, and age-friendly design) to workforce dynamics and healthcare demand.
5. Low unemployment and high participation
Simon forecast that unemployment would remain comfortably below 5%, and that’s exactly what happened.
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Despite all the talk about economic uncertainty, we’re still in a tight labour market, especially in sectors like health, construction, and education.
Importantly, this low unemployment exists alongside historically high workforce participation, particularly from women and older Australians.
It reinforces that Australia’s economic engine is still running hot, and that we’re not heading into a deep jobs crisis anytime soon.
Where the predictions fell short
1. Car sales didn’t rise
Simon predicted that car sales would rise due to millennials moving from inner-city lifestyles to car-dependent suburbs, transitioning from one-car households to two or more.
The logic was sound. But reality intervened.
Thanks to cost-of-living pressures, many Australians delayed big purchases like cars.
Instead, we’re keeping vehicles longer, the average age of a car in Australia is now over 11 years, up from 10 a decade ago.
It’s a lesson in consumer behaviour: even when demand exists demographically, financial pressure can delay or distort outcomes.
2. Inflation didn’t fall as expected
Simon expected inflation to ease more quickly than it did.
While interest rates did begin to normalise (he correctly called three cash rate cuts), inflation proved more stubborn.
And part of the reason for this is Millennials again.
As Australia’s biggest generation, they’re in their peak spending years.
Their consumption patterns alone are inflationary, and that’s something many forecasters underestimated.
Simon owned this one:
“I forgot to fully factor in just how powerful millennial consumption would be. That one’s on me.”
Other noteworthy predictions that came true
- Electric vehicles gaining ground: Fleet upgrades are driving EV adoption. While still under 10% of new car sales, EVs are becoming mainstream thanks to corporate commitments and state incentives. The long-term trend is clear.
- First Home Buyers getting older: Despite schemes like shared equity and lower deposit loans, the average age of first home buyers keeps rising. Demographics and delayed family formation are driving this shift.
- Inbound tourism rebounded: Post-COVID tourism surged in 2025, driven by a weaker dollar and the growing Asian middle class. Australia’s appeal remains strong.
- Gender pay gap narrowed: Education is paying off, literally. Women now outperform men in tertiary qualifications across every age cohort. That’s flowing into earnings, particularly among younger workers.
- Indoor play centres thriving: As backyards shrink, indoor play centres are booming. These ‘third spaces’ fill a crucial need for families in higher-density or greenfield areas.
- The war on vaping intensified: Legislation tightened, marketing collapsed, and vaping lost its “cool” factor. Youth usage dropped from 18% to 15%, a small but meaningful win in public health.
Lessons for business owners and investors
Simon’s final scorecard?
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13 predictions correct
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4 unclear (due to lack of complete data)
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3 incorrect
That’s a pretty solid batting average.
More importantly, the wins weren’t just lucky guesses. They came from understanding how slow-moving forces: ageing, migration, urban development, and education, compound over time.
Simon said:
“The future isn’t as random as it feels. The headlines change every day, but the fundamentals rarely do.”
As investors and decision-makers, we need to anchor our strategies in those fundamentals.
Don’t make 30-year property or business plans based on the last 30 minutes of media noise.
Demographics won’t predict tomorrow’s newspaper, but they will help you make better, smarter, long-range decisions.
For weekly insights subscribe to the Demographics Decoded podcast, where we will continue to explore these trends and their implications in greater detail.
Subscribe now on your favourite Podcast player:
