The national population increased by just over 396,000 new residents over the 2013 calendar year; 9,300 fewer new residents compared with the annual period ending June 2013.
Population growth is an important indicator for the housing market as it represents a proxy for housing demand; more residents imply more people who require accommodation. The rate of national population growth reached a record high over the 2008 calendar year, recording an annual growth rate of 2.2%; since then population growth fell away sharply, reaching a recent low point of 1.4% over the year ending March 2011 before rising to a new recent highpoint of 1.8% over the 2012 calendar year. The latest data from the Australian Bureau of Statistics indicates the rate of population growth has been slipping since mid last year, slowing to an annual growth rate of 1.7%.
Despite the slowdown, population growth remains well above average. The graphs immediately below show the trend in the components of national population growth. The level of natural increase (ie births minus deaths) was 8.6% higher than the ten year average and 19.1% higher than the 30 year average over the 2013 calendar year. Net overseas migration was tracking substantially higher than average at 16.7% above the ten year average and 78.6% above the 30 year average.
At the state level there are some diverse trends across the components of population growth. In raw numbers, NSW is continuing to attract the largest number of new residents, at 110,923 over the 2013 calendar year. Victoria showed the second largest number of new residents (107,916) followed by Queensland (79,706) then Western Australia (71,301).
Net overseas migration is the largest component of population growth across each of the states except Tasmania and the Australian Capital Territory, where natural increase outweighs net overseas migration numbers. The number of overseas migrants is highest in New South Wales where there were 71,446 net migrants over the calendar year. Victoria showed the second highest number of overseas migrants at 62,337. Both of these states are continuing to show a healthy upwards trend in overseas migration. Net overseas migrants into WA were the third highest of any state, at 45,401, but there has been a substantial decline over the year with overseas migrant numbers down 19.8% compared with the 2012 calendar year. A similar trend is evident in the other mining state, Queensland, where overseas migration is down 19.1% over the year.
For the second consecutive quarter, Victoria has attracted the largest number of net interstate migrants. This title has historically gone to Queensland and more recently Western Australia, however the slowdown in the resources sector has stymied the interstate flow of residents into both of these states. Over the December quarter there were an additional 2,106 new residents from other states that chose to reside in Victoria which is an all-time record for the state. Interstate migration flows remained positive in Queensland (+6,897 over the year) and Western Australia (+4,800), while every other state and territory recorded a net outflow of residents to other states.
The rate of natural increase across each of the states is also quite different. The upwards trend in the level of natural increase is strongest in WA where the natural increase in residents was 4.4% higher than a year ago. The ACT also showed a substantial rise in natural increase, up 4.3% compared with a year ago. The regions that have seen a decline in the rate of natural increase are Victoria (down 7.0%), Northern Territory (-5.0%), Tasmania (-3.1%) and Queensland (-2.1%).
With population growth winding down we can expect some further easing of housing demand, both from a sales and a rental perspective. The slowdown seems to be most pronounced in the mining states of WA and Qld where population growth conditions have previously been the strongest.
Article by RP Data senior research analyst, Cameron Kusher