What does Sydney’s faster population growth mean?
According to new figures released by the Government, Sydney’s population is growing much faster than predicted, adding to the pressure of the city’s already congested transport system and shortage of residential housing.
New figures show that the population of Sydney is expected to increase by more than 2.1 million people over the next 20 years. This is approximately 170,000 more people than predicted just two years ago in 2014.
However, according to NSW Planning Minister Rob Stokes, this pressure on Sydney’s transport infrastructure and housing supply are a "symptom of Sydney's success.”
In 2014, the population of Sydney over 20 years was expected to reach 6.25 million, increasing from 4.29 million in 2011. However, the new projections expect Sydney’s population to reach 6.42 million in 20 years.
Mr Stokes suggest, "The problem of a growing city is real, but it is far better than the opposite problem of a shrinking city."
For New South Wales, the population here is also expected to rapidly rise by 2.7 million, rising to nearly 10 million people by 2036.
Previous forecasts required Sydney to have another 664,000 new homes by 2031 According to previous forecasts, Sydney needed another 664,000 new homes by 2031 to accommodate the growing population. However, the new forecasts now require Sydney to build another 726,000 new dwellings by 2036.
Mr Stokes expressed his opinion that Sydney requires more housing types besides suburban blocks and apartment towers. Under the Barcelona model, more medium density and terrace housing throughout established Sydney suburbs would be required.
"There are going to be areas of towers [in] central parts, but we don't want that across the urban fabric," said Mr Stokes. "That doesn't respond to the way Sydneysiders want to live."
However, in spite of this, not everyone is able to afford a detached Sydney home, within a middle ring suburb on 800 square metres of land, so terraces on smaller developments of 200 square metres of land could be launched instead to appeal to those who still want a home with a backyard and street frontage.
One of the major drawbacks of this approach is the availability of land. For Sydney, it is pretty impossible to build 726,000 new dwellings that are just single storey or terrace homes. There is a critical need to build upwards, due to the restrictions that Sydney faces from the harbour and mountains. In spite of this, there are areas in NSW that have availability of land, but are not yet easily accessible and therefore not very attractive places to live.
So what does this increased population mean for Sydney’s suburbs? The Camden area for example is anticipated to increase from 58,000 residents in 2011 to 224,000 in 2036. This is a 286% increase, or 166,000 additional new residents.
What does this increased population mean for Sydney’s suburbs?
Camden’s not the only area that is expected to see dramatic population changes. Parramatta is also expected to see its population double from roughly 200,000 in 2011 to 416,000 in 20236, whilst the City of Sydney’s population will also face a similar increase, from 183,000 in 2011 to 315,000 in 2036. Parramatta is Sydney’s second CBD and is set to offer specialised health and education precincts, better local transport connections alongside world-class cultural and arts facilities.
Both The Hills and Liverpool area anticipate an increase of 142,900 each, whilst Blacktown anticipates a major increase of 209,100 residents by 2036.
With more new developments in Sydney’s west such as the Sydney Western Airport at Badgerys Creek and proposed new transport infrastructure in this region, it makes sense for Sydney’s western suburbs to see higher population increases, compared to more established and blue chip areas such as Hunters Hill, Mosman and Woollahra, who only see nominal changes of 1,850, 2,900 and 3,550 respectively over the next two decades.
However, in order to efficiently cater for Sydney’s rapidly increasing population, the amenity needs to be there, as does the roads infrastructure and transport. Public transport in certain areas are already heavily congested, and this will only get worse if not properly addressed.
What will drive the Sydney population increase? Although NSW is expected to see negative net interstate migration which sits in line with historical trends and data, overseas migration and natural increase will be the two main drivers of Sydney’s population increase. According to Planning NSW, net overseas migration will account for 1.74 million of the 2.71 million residents by 2036.
However, as permanent migration is determined by government policy, the actual population outcomes for overseas migration will highly depend on the future immigration policy. In spite of this, overseas migration is important to Australia and is expected to remain strong to ensure steady economic growth.
Sydney’s ageing population growing too As well as the population as a whole growing faster than predicted, Sydney’s ageing population is also rising, helped by better healthcare. Scarily, the city will be home to almost half a million more people aged 65 years or move over the next 20 years.
This adds pressure on the economy to support those in retirement and creates urgency for the younger generation to be able to afford a property in the first place. With a higher demand for property over the next two decades, this will surely push the property prices up even more, so if you thought buying a property today was difficult, then you don’t want to leave it too long as you will undoubtedly face higher competition in the years to come.
The Housing Plan for Sydney is to create more affordable housing opportunities as well as providing different housing types to appeal to those at different stages of their life, whether they are at retirement or are starting a family.
To find out more about what Sydney’s rapidly rising population means on the economy and on the housing market, why not get in touch with our expert Property Consultants at iBuyNew. We can advise you on where you should be buying property and what the high growth suburbs are to make a solid investment.
Call us today on 1300 123 463 to learn more.
Published on 20th of October 2016 by Marty Stanowich