With housing affordability at an all-time low, young people are looking beyond city limits for their first home. Is this trend likely to continue and can the regions cope?
Like thousands of other young people who've fled the capital cities for the regions, Clem Daw and Tara McDonough are surprised how much they love their new home.
The couple was renting in Thornbury in Melbourne's inner northeast, where they felt priced out of the market. So they moved to the regional town of Chewton outside Castlemaine in central Victoria.
"We probably couldn't afford to buy the two-bedroom unit that we were renting. It became an easy decision to make when we saw how much more we could get in the country," Ms McDonough explained.
But the move wasn't just about affordability.
"There definitely was a sense of wanting to try something new. And we were also on the cusp of starting our family and ready to embrace the change," said Mr Daw.
They wanted Melbourne within easy reach, though.
"Keeping it within an hour and a half's commute was important. Castlemaine just really felt like a great environment, a lovely community, and we noticed a lot of other young people moving to the area," Ms McDonough said.
The couple now intends to stay in the area "for the long haul", she added.
"We've both been surprised at how much we've taken to Chewton and how much we love it."
Clem Daw and Tara McDonough moved their young family to Castlemaine in Victoria after being priced out of inner Melbourne. Picture: REA Group.
Young people 'realising their dreams'
Every day across Australia, more and more people are leaving city life behind for a new start in the regions.
This trend started before the pandemic, then was supercharged by workplace flexibility. But by late last year, the number of city dwellers moving to regional areas seemed to dip.
However, the first quarter of 2024 saw it rebound to a 12-month high, according to the latest Regional Movers Index (RMI).
Metro to regional relocations now sit at 20% above the pre-COVID average, with Millennials – those currently aged 28 to 43 – leading the charge from every capital city.
PropTrack's Director of Economic Research, Cameron Kusher, said this is due to ingrained workplace flexibility and housing affordability issues.
"We've seen quite strong price increases over the last few years in most capital cities, and while prices have continued to increase in regional markets, this hasn't been to the same magnitude," he said.
The Regional Movers Index found an increase in people moving from the cities. Picture: REA Group
Regional Australia Institute chief executive Liz Ritchie said there were 24% more people moving away from the city to regions than the other way around.
"The regional renaissance is rising as Millennials realise their dreams and aspirations," she said.
"They want space, a sense of community, and to be connected with nature.
"They're seeing that they can have a better-rounded life, an exciting career and potentially get into the property market in the regions – without the long commute times, tolls and traffic."
Where are they moving to?
Sydney continues to be the nation’s biggest shedder of people, accounting for 67% of net capital city outflows to the regions over the year to March 2024.
The biggest beneficiaries of these city departures are the Sunshine Coast and Gold Coast, which suggests the move is not just about affordability but also lifestyle.
Many people leaving Brisbane are relocating to the Sunshine Coast. Picture Getty
"The median house price on the Gold Coast is higher than Brisbane, Melbourne, Adelaide and Perth. So a lot of people are moving to this market, but it's not necessarily that affordable," said Mr Kusher.
Many of those leaving the cities tend to choose large regional centres within commuting distance of their previous home.
From Sydney, they head to Wollongong and Newcastle; from Brisbane, to the Gold Coast, Sunshine Coast or Toowoomba; from Melbourne, to Geelong and Ballarat; from Perth to Busselton; from Adelaide to Alexandrina (which includes Strathalbyn) and the Barossa; and from Hobart to Launceston.
Good news and bad for the regions
On one hand, Millennials arriving from the city was great news for regional areas. They bring new businesses, expertise, innovation and diversity.
On the other hand, they increase pressure on infrastructure and housing – the very issues they were trying to escape.
"Revitalisation of regional areas is really important," said Mr Daw. "The challenge is that it can put pressure on local people who are also struggling under the same conditions for employment and housing."
Toowoomba was another Queensland town attracting former city dwellers. Picture: realestate.com.au/sold
Mr Kusher said regional centres were feeling the strain.
"Delivering more housing in regional markets is even more challenging than in the capital cities. So it's pushing the problem from our major capital cities into these regional areas. Affordability is going to be a challenge."
Local governments must attract housing developers, approve projects quickly and boost infrastructure – needs that are urgent in fast-growing areas like the Gold Coast, he said.
Ms Ritchie agreed regional areas "have been caught short".
"Nobody expected that pendulum to swing as quickly as it did. We want to ensure communities have the services, skills and infrastructure they need for their growing populations," she said.
"We need to embrace this regional renaissance."
English (US) · 