In 2012, the population stood at approximately 4.2 million, steadily growing to reach 5 million by 2019. During this period, the city witnessed a consistent increase in population, averaging around 100,000 new arrivals per year. About 70 per cent of the population increase can be attributed to an increase in net overseas migration.
However, the emergence of the pandemic brought about a drastic change. The imposition of lockdowns and travel restrictions led to a significant drop in population growth, with only around 53,000 individuals being added in the 2019–20 financial year, then in the following financial year, 2020–21, Melbourne recorded its first negative population growth since 1952, losing around 79,000 people. Fortunately, as restrictions eased, a swift recovery was observed, with an addition of approximately 55,000 individuals in 2021–22.
The recently released population projections by the Centre for Population and the latest Budget 2023–24 assumptions suggest that Melbourne's recovery is on an upwards trajectory, and it is anticipated we will reach a population of 6 million by 2032, adding around 92,000 people annually from 2023 onwards.
So what does this mean for residential real estate? As the population increases, there is a spillover effect on the housing market whereby the demand for property increases. This begs the question, where will these people want to live?
Components of population change, Greater Melbourne, 2016–2033