The latest Regional Movers Index – a partnership between the Commonwealth Bank and the Regional Australia Institute (RAI) – found quarterly migration from capital cities to regional areas over the past two years is averaging 15 per cent higher than the two years pre-COVID-19.
The steady increase in migration during the pandemic continued till the end of 2021, despite a 10 per cent fall in the latest quarter that was “largely seasonal”.
The fall in the December 2021 quarter comes as regional house prices “accelerated” in 2021, following a more modest rise in 2020.
When looking at capital-city outflows to regional towns, 99 per cent came from Sydney and Melbourne (53 per cent and 46 per cent respectively), as those two cities experienced the most lockdowns during the pandemic.
The net inflows to regional Australia were not so evenly distributed across the three main states, with regional NSW picking up half of the net inflows to regional Australia, while regional Victoria and Queensland each had a share of around 20 per cent – in the year to December 2021.
This was a slight contrast to 2020 where regional Victoria picked up a larger share – just over one-third – of the net inflows into regional Australia that year.
Executive general manager for regional and agribusiness banking Paul Fowler, at Commonwealth Bank, said city-siders have really embraced Australia’s regions over the past two years.
“As we see flexible working arrangements continue and Australia’s domestic and international borders opening up, it’s likely we will continue to see this movement as people recognise the benefits of a regional lifestyle,” Mr Fowler said.
Of all relocations during the December 2021 quarter, capital city dwellers moving to the regions have generally accounted for a 6.1 per cent share, up from the 5.3 per cent share pre-pandemic.
Meanwhile, the share of regional people making a city move has ebbed and flowed a little more, but has hovered around a 4 per cent share during the pandemic, down from the 4.3 per cent share pre-pandemic.
Qld and SA saw highest growth rates
The local government areas (LGAs) that experienced the strongest annual growth in migration from capital cities in 2021 were all in Queensland and South Australia.
In particular, Port Augusta in South Australia topped the list with 54 per cent growth in year-to-date migration, closely followed by Douglas (up 49 per cent) and Western Downs in Queensland that saw a 48 per cent increase in growth.
Mount Gambier in South Australia and Banana in Queensland were also among the top five LGAs with strong annual growth of 44 per cent and 40 per cent respectively.
Regional boom leaves property scarcity
The rush to regions has come at a cost for some communities. South Australian broker Aaron Vogt, at Preferred Finance, said the regional boom in combination with the HomeBuilder grant has meant there are fewer properties available.
“We are a land-bank essentially, so all of the land that could be sold, got sold and clients are now struggling to get blocks of land. Because we’ve pretty much sold everything,” Mr Vogt said.
“I guess it is a challenge for clients, especially first time buyers looking for the lower deposit and the first home owners grant to help them get into the market.
“That is a challenge that we’re just having to endure.. because if there’s no land, there’s no land, and they’re just out there looking to try to get something when [nothing’s] available.”
City dwellers flocked to coastal towns
Meanwhile high-population coastal centres close to capital cities continue to be the main destination for capital-city dwellers making a regional move.
The Gold Coast was the most popular destination, welcoming 11 per cent of all capital-city dwellers who moved to regional areas during 2021.
The next most popular destinations were the familiar LGAs of Sunshine Coast (taking 5 per cent of city dwellers over the 12 months to December 2021), Greater Geelong in Victoria (with 4 per cent), while 3 per cent moved to Wollongong and 2 per cent to Lake Macquarie in NSW.
In line with the national trend, capital-city migration fell during the December 2021 quarter.