Continued strong population growth – particularly in Melbourne and Sydney – is a significant demand factor that continues to place upward pressure on house prices. Added to this fact are the findings of a recently released report titled Millionaire Migration (prepared by New World Wealth), which identifies that in 2015, Australia attracted a higher number of millionaire emigrants than any other country across the globe. The report identifies that almost of these moved to Sydney and Melbourne.
For those cities attractive to the wealthy there can be significant benefits. This includes capital investment, employment creation, greater global networks, and increased tax revenues.
In the years ahead, Australia is well poised to accrue such benefits as the variety of push and pull factors at play across the globe are likely to result in a continuation of affluent migration, particularly to Melbourne and Sydney.
Though a compelling endorsement for all Australia has to offer, the impact of affluent migration together with strong, future population growth more generally, will further drive up house prices, particularly in those markets such as Sydney and Melbourne, which are already amongst the world’s most unaffordable.
Though the continued arrival of wealthy migrants to Australia risks adding further to the housing affordability problem, capitalising on the opportunity to do so may well be a sound policy that brings considerable social and economic gains in otherwise challenging times.
In a rapidly changing world, this issue highlights just one of the many challenges confronting our major cities as they continue to grow at an unprecedented rate.