Queensland the Population Powerhouse
The latest population data has been released from the ABS today and demonstrated that Queensland is leading the nation in net interstate migration and population growth overall. In fact it is not just leading, it is dominating as a destination where people want to live. People are voting with their feet and leaving NSW and Victoria for sunnier climates and more affordable property. Jobs are relatively easy to come by compared to previous years, so the 25-44 year olds that drive Australia's economy are increasingly packing up their families and moving to the Sunshine State.
The problem is that SEQ is almost full. Poor planning and monitoring of supply and infrastructure capacities has meant that most suburbs have little spare capacity in rental properties or available homes. Transactions are down because residents don't want to risk being homeless. Brisbane City Council has attempted to address the supply imbalance by making those persons who have an investment property being used as short stay or air-bnb pay commercial rates. Whilst this may or may not be legal given the retrospective attributes to this announcement, it does demonstrate in real terms how desperate the councils have become to lift supply any way possible in the short term.
All of this comes on the back of a development industry that is suffering from the following;
* Skills shortages in the construction sector;
* Breakdowns in the supply chains;
* An almost doubling of the time to build a detached home in many locations;
* Considerable uncertainty around medium and high rise construction costs causing developers to shelve projects;
* Long approval processes for greenfield sites whereby masterplanned communities usually take in excess of a decade to commence;
* Layers and layers of legislation and overlays for large projects;
* Shortages of good quality, well located industrial land;
* Many road networks are stretched beyond capacity during peak hour.
With Queensland accounting for 57% of the nations total population growth and Western Australia another 23%, both States have some population issues to deal with. Resolving them quickly won't be easy, nor will it be cheap.
Any talk of a residential price crash in SEQ for the moment would also seem highly unlikely. However the damage of an undersupplied market can be equally as harmful as one that is oversupplied.
What should be of significant concern to our policy makers is that overseas migration has not rebounded yet. When it does, Queensland's economy will be supercharged much like the early 2000's which set off almost a decade of growth.
What the population data alludes to is that the impacts of the Pandemic are far from being resolved. Business as usual is anything but. Whilst Queensland should continue to roll out the welcome mat, perhaps it should also state, "Please queue here".
Matthew Gross | Director | mgross@nprco.com.au
