Inner-city dwellers who have spent the better part of the last year cooped up inside their shoebox apartments during COVID lockdowns are being lured away to regional areas.

Data from Commonwealth Bank and the Regional Australia Institute (RAI) shows an 11% rise in the number of people moving from capital cities to regional areas in the June 2021 quarter, compared with the June 2020 quarter.

The data shows the local government areas (LGAs) that have recorded the biggest growth in people relocating are from areas that have had the nation’s longest COVID lockdowns.

Source: RAI

Melbourne’s share of net capital city outflows increased to 47%, up from 39% the year before. The regional areas Melburnians are moving to include Moorabool (68% increase), Mansfield (62% increase) and Corangamite (52% increase).

Victoria’s Greater Geelong area – located one hour outside of Melbourne’s CBD – also saw an influx in capital city movers, with an increase of 26% during the year to June 2021.

Sydney still had the highest share of net capital city outflows at 49% with regional NSW picking up the largest share of net migration into regional Australia (34%).

The Murray River area in NSW saw a 48% increase in people relocating.

Commonwealth Bank’s Executive General Manager for Regional and Agribusiness Banking Grant Cairns said the move to working from home has made the dream of escaping from the city possible for many Australians.

“With house prices rising across the capital cities and flexible work options now more commonplace, the decision to make a lifestyle shift and move to a regional area has become a realistic option,” Mr Cairns said.

“The experience of lockdowns is front of mind for Victorians, so the desire to seek a tree change is rapidly growing. It is positive to see the development of infrastructure – particularly in regional areas – is growing to meet the increased demand.”

Escape from the city contributing to regional housing squeeze

The influx of city dwellers into regional areas is contributing to a regional housing squeeze, making housing more expensive and competitive for locals.

According to the Regional Movers Index, approvals for new housing in Geelong were 48% higher in 2020/21 in comparison to the previous year.

RAI’s Chief Economist Dr Kim Houghton said the uptick in residential developments has come at the same time as a surge in infrastructure, identifying the areas due for a burst in population growth.

“It also shows us places that are coming off the boil in the June quarter, such as Noosa (QLD) and Mildura (VIC),” Dr Houghton said.

“We can also see that the number of regional residents choosing to stay put has increased, which is likely to be contributing to the housing squeeze in some areas.”

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