Population change in 2014 – how Sydney got its groove back

In recent years, many parts of Australia have recorded very high rates of population growth, but strangely its largest city – Sydney – has by and large not been part of this record growth trend. For most of the last decade, the rate of growth in Sydney has been below the national average. Furthermore, the volume of growth in Melbourne has exceeded that recorded in Sydney every year since 2004. We’ve even published an e-book highlighting the different ways in which Sydney and Melbourne are growing. We often remark at the lower growth rates recorded in the Sydney LGAs eg no Wyndham, but there is a Blacktown, but the latest data indicates that things might be changing. Since 2013, Sydney’s population growth rate has been at or above the national average. Let’s have a look at the latest trends.

What is Sydney’s population?

In 2014, Greater Sydney reached a population of 4.84 million, up from 4.76 million in 2013. This represented an annual growth rate of 1.8%, and compares to the national average of 1.6%.

The volume of growth in Greater Sydney has been volatile over the past decade and generally reflects economic conditions and the level of net overseas migration. For instance, Greater Sydney grew very strongly in 2008 and 2009, at a time when net overseas migration to Australia was very high. The table below shows the volume and rate of growth in Greater Sydney since 2004-05.

Source: ABS, Regional Population Growth (Cat.no. 3218.0)

What areas are growing strongly?

Of course this increased growth is not evenly distributed. Sydney’s growth hotspots have generally been in the outer north west and south west, as well as in the central city and Parramatta Road corridor. This pattern is largely unchanged, as the map below shows. The fastest growing LGA in Greater Sydney in 2013-14 was Camden (6.1%), followed by Botany Bay and Sydney (both 3.4%). There were no LGAs that lost population, but several grew at modest rates, including Hawkesbury and Blue Mountains (both 0.6%), Ashfield and Gosford (both 0.7%), Fairfield (0.8%) and Sutherland (0.9%). Hawkesbury and Blue Mountains are constrained environmentally, but other areas have maturing households or lack major redevelopment sites. Fairfield is quite distinct in western Sydney as its slower growth contrasts with surrounding LGAs which are growing strongly. This LGA is characterised by mature households, redevelopment precincts and lower demand for new housing.

Though it should be noted the ERPs are preliminary and subject to change, it does confirm what we at .id have suspected through our forecasting work in particular – that dwelling construction rates have increased, and that this is resulting in subsequent population growth. Certainly the number of building approvals has increased, but these take time to turn into dwellings on the ground. The highest growth rates in Sydney (ranked at 2013-14), and how this has changed over the last decade, are shown in the table below.

Source: ABS, Regional Population Growth (Cat.no. 3218.0)

Camden is a great example of how population growth has increased, even from already above average levels. Located in Sydney’s outer south west, it often recorded the fastest growth rate in the metropolitan area. However in 2013-14, the rate recorded was 6.1%, compared to 4.2% the previous year. The post 2011 growth rates are much higher than those recorded in 2006-11. The 2013-14 figure is also around the level recorded by Wyndham – we’ve often blogged how this is one of the fastest growing LGAs in the country. Camden has numerous greenfield development fronts which are growing quickly eg Oran Park, as they offer relatively affordable home owning opportunities for young families. Population forecasts for Camden clearly show that growth will continue to be high well into the future, as there is significant future supply and demand for new housing. Almost 20,000 more people call Camden home in 2014 compared to ten years earlier.

Population growth rates in Sydney and Botany Bay are closely linked to the completion of new apartment buildings as these form the bulk of new housing supply. Botany Bay has been transformed in the last ten years with significant development around Mascot Station. However once this area is built out it will be difficult for Botany Bay to maintain this level of growth as there are not many strategic development sites located elsewhere in the City.

But of course growth rates only tell part of the story. As always when discussing population growth trends in Sydney, you can’t ignore the role of Blacktown. Blacktown is a very large LGA and also has several greenfield development fronts. With a population over 330,000, its rapid growth is masked by mathematics, but in volume it heads the list. Blacktown added 7,285 people in 2013-14, translating to a growth rate of 2.2%, consistent with the last few years. To put Blacktown’s growth in perspective, the volume of growth (7,290) was twice that of fastest growing Camden.

So while Sydney has recorded increased growth, the spatial pattern remains largely unchanged. The key issue is that the rates and volumes have increased in the last couple of years. Furthermore, there are indications that Sydney’s growth will remain high for some time, with evidence of increased building approvals and overseas migration. Despite the higher population growth in Melbourne, Sydney is likely to remain Australia’s largest city for quite some time yet.