The trend of Australians leaving big cities for more affordable housing in less populated areas may impact your urban rental properties. So what can you do to keep up with the changing migration patterns? Here are some great starting points and tips to think about in 2022.
No, this is not just a rumour. Since the beginning of the COVID-19 pandemic, "capital cities had a net loss of 11,800 people from internal migration, the largest quarterly net loss on record," according to the Australian Bureau of Statistics. The impact of lockdowns on the population of capital cities is exemplified in the net shift to living in more regional areas. Melbourne saw the largest migration loss on record, according to the Centre for Population. Their data revealed that 17,200 residents left the city in 2020, which is 25 times the number from 2019.
In addition, more young professionals are working remotely, able to have jobs that allow them to live anywhere. This encourages more people to consider living in more accessible areas without being tied to a large city just because of their profession.
As with most investment opportunities, nothing remains the same for too long and this is true for urban rental properties as well. There will always be a new hot location that is worth investigating as to whether it fits into your portfolio. Don't abandon your properties in the capital cities right away, however. The rental yield in most cities is actually up according to CoreLogic's Hedonic Home Value Index:
It's important to keep an eye out for population booms in other areas. This could offer you some insight into what may be a great new investment option. According to ABC News, "South-East Queensland and the regional cities of Geelong in Victoria and Wollongong in New South Wales have experienced some of the biggest population growth." In addition, the November 2021 article mentions Augusta-Margaret River and Denmark in Western Australia and the Byron Shire on the NSW North Coast as areas that are seeing some serious growth. This is turning these areas into small urban centres within themselves.
As populations shift and respond to global conditions, investors must respond and even try to forecast potential changes.
To learn more about your property investment options, reach out to Ray White today.