by Jemma Pearson Population changes have a huge impact on property markets. So what’s going on with the people of the world? MPP finds out.

The long-term price of property in any region, state or nation is driven by a variety of complex factors, but in simple terms, population growth and the wealth of the people that populate a given region or nation drives the price of homes in that location. A growing, declining or shifting population will impact on the price of property. So what’s going on with the people of the world? MPP takes a look at some numbers.

GROWING?

According to the United Nations, the world population reached 7 billion on October 31, 2011. And it keeps growing, at a rate of about 1.1 per cent a year. While that seems like a healthy increase, compare that to the 1960s, when the annual growth rate was a vigorous two per cent and more. Future projections have the growth rate slowing to around one per cent a year, which means that by 2020, the world will house 7.6 billion people.

Closer to home, the Australian Bureau of Statistics keeps track of the nation’s population changes. According to an ABS media release from December 2011, “Australia’s population increased by 1.4 per cent (320,800 people) to 22,620,600 people [in the year to June 30, 2011]. Net overseas migration accounted for 53 per cent of the growth for the year ending June 2011, with the remaining 47 per cent due to natural increase (births minus deaths).”

According to the ABS, the median age in the nation increased by 4.7 years over the past 20 years, from 32.4 years in the middle of 1991 to 37.1 years in 2011. So we are an ageing population as well as a growing one.

MOVING?

But are we a population of movers? Not at the moment, says RP Data senior research analyst Cameron Kusher. He tells MPP, “The population is actually showing amongst its lowest propensity to move than it has in a very long time. In fact, the latest demographic data from the Australian Bureau of Statistics shows that over the year to June 2011, Queensland gained just 7150 persons from other Australian states, the lowest number across the time series of data which dates back to June 1981.”

So why aren’t southerners moving to the Sunshine State? “In the aftermath of the global financial crisis, consumers are cautious and are showing a much reduced propensity to move interstate,” Cameron says. “The outflow of residents from NSW is at around the lowest levels since the late 1990s and Victoria is gaining residents from other states at the fastest rate since 2002 after a net loss of residents for much of the period thereafter.”

The real change, says Cameron and other experts in the field, is in the make-up of the Australian household.

CHANGING?

“Historically, family households have been the dominant housing type across Australia,” says Cameron. “However, this has changed quite a bit over recent years. With the increase in marriage breakdowns there has been a sharp increase in single-person households and family households with just one parent.”

But it’s not just a change in families. Released by the ABS, the publication Australian Social Trends draws on a wide range of data, from the ABS and other agencies, to present a picture of Australian society. The latest Australian Social Trends report on the future of Australian households states, “By 2031 the population of Australia is projected to be over 28 million. In 2006, there were a total of 7.8 million households in Australia. By 2031, the number of households is projected to grow to between 11.4 and 11.8 million.

“Whilst the number of households is projected to increase, the average number of people within each household is projected to decline from 2.6 in 2006 to between 2.4 and 2.5 people per household in 2031.”

What this means is that the number of households in the nation will grow at a faster rate than the overall population.  

“The projection of an extra 3.8 million households between 2006 and 2031 represents growth of 1.6 per cent per year, while the population is projected to grow by an average 1.3 per cent per year over the same period,” the report states, concluding, “Population growth and the ageing of the population, along with societal changes such as the propensity for people to have smaller families, or live alone, are projected to lead to that extra 3.8 million Australian households by 2031.”

But these households don’t just add up to more of the same. The dwellings themselves and related services will need to reflect the requirements of the people. For example, demand for single-person accommodation close to health and support services will increase due to the ageing population. “The scale of the projected growth,” says the ABS, “particularly in the capital cities, is likely to present significant public policy challenges for city planning and service provision.”

WHAT DOES IT ALL MEAN FOR PROPERTY?

Australia is well placed to benefit from Asia’s economic growth, especially given our robust resources sector. And closer to home, the Coast’s natural beauty and lifestyle gives us an edge over other regional centres. Our planners are gearing up for plenty of expansion – an airport upgrade is on the way, the Maroochydore skyline is changing daily, while Caloundra South and the Kawana hospital are huge projects that promise jobs, homes and more.

There has been a sharp increase in single-person households and family households with just one parent. Cameron Kusher, RP Data

Population growth here is inevitable, but Cameron has some advice for those planning our future. “There will be a number of important issues for the region to address, namely: how does it provide sufficient jobs to encourage home owners in to the region; how does it attract a variety of industries, not just tourism and construction; if the diversity of jobs can’t be offered in the region how do linkages to Brisbane get improved to encourage commuting; and how can the region improve housing affordability?

“I believe the region will continue to grow and attract people of all ages,” Cameron concludes, “but it is imperative the planning for transport infrastructure, essential services, jobs and housing happens now rather than once the influx re-commences.”

How will it all come together? Watch this space to find out.

Leaving the city behind

According to the Department of Foreign Affairs & Trade, “Australia is one of the most urbanised and coast-dwelling populations in the world.” The news is not at all surprising, but is that trend changing? Whether it’s for lifestyle or for work, there is small but vocal group who are leaving the city behind.
In a recent article published by The Australian newspaper, Cameron Kusher’s colleague, RP Data’s head of research, Tim Lawless predicted a population move away from cities to major regional centres.

No doubt mining is attracting investors to some regional areas while others will be looking for a sea or tree change. Researching potential regions to invest in, property buyers will look at population growth, mining or economic growth and infrastructure and new housing plans.

Because we are close to Brisbane and the Bowen basin, and with our beaches and hinterland, the Sunshine Coast is an attractive location for all sorts of investment. Established infrastructure and a diversification of industries are also in our favour.

Other regions attracting investor dollars include Gladstone and Townsville further north, Ipswich and Emerald out west and across the border, Lismore and Port Macquarie.