Poor Housing Affordability in Cities boosts Regional Growth

Despite Australia’s international competitiveness being compromised by slower economic growth, an appreciating Australian dollar, and record low housing affordability, overseas migration and regional population growth has provided a welcome boost to the fortunes of Australia's housing industry.

Commenting today on the release of HIA’s annual Population and Residential Building Hotspots publication, Australia's peak building industry body HIA said that another strong year of overseas migration and a solid spike in Australia's fertility rate saw Australia's total population growth rate jump from 1.2 per cent to 1.3 per cent in the 2005/06 year.

HIA’s Executive Director of Housing and Economics, Mr Simon Tennent, noted that, according to the ABS, population growth in regional areas was equal or faster than capital city growth in the three largest States over 2005/06.

“Record low housing affordability in many State capitals has forced an increasing number of first home buyers to relocate into non-metropolitan areas, which in many cases has caused these people to give up their current jobs in the hope of finding a home to start a family,” Mr Tennent said.

“In addition, the balance of residential building work is also moving out of capital cities and into non-metropolitan areas, with many building and population ‘hotspots’ being located in regional centres where housing is  considerably more affordable.”

The population of all States and Territories grew over the 2005/06 financial year, with the largest increases occurring in Queensland, Victoria and New South Wales. The fastest growing States and Territories were Western Australia (2 per cent growth rate over 2005/06), Queensland (1.9 per cent growth rate) and the Northern Territory (1.6 per cent growth rate).

In terms of capital cities, the fastest growing over 2005/06 were Darwin (2.5 per cent) and Perth (2.0 per cent). Population grew in all inner city areas except for the city centre of Canberra, were population fell by 1.3 per cent. In regional areas, population growth was strongest in regional Queensland and regional Western Australia.

CONTACT:

For a copy of the full 80 page HIA Population and Residential Building Hotspots report please contact Kirsten Lewis on (02) 6245 1393 or k.lewis@hia.com.au

For further information on this release, please contact:

Simon Tennent, HIA Executive Director, Housing and Economics

Phone: 0419 445 557

Email: economics@hia.com.au      http://economics.hia.asn.au