Megan Lieu, Economic Analyst at REA Group recently published an article which highlights Victoria as the preferred destination for migrants settling in Australia. Let’s explore some of the factors that feed into that decision…

A Growing Magnet for Population and Opportunity

There’s one State in Australia making waves in population growth, attracting both local and overseas migrants in record numbers. With the country’s population growing by 2.3% annually as of March 2024, this State stands out, achieving a remarkable growth rate of 2.7%—the largest absolute increase of any State, adding an impressive 184,000 people to its population.

After a period of slowed migration during the pandemic, this State is now seeing positive net interstate migration for the first time since 2021. Combined with strong overseas migration trends, this resurgence highlights its growing appeal to those seeking affordability, opportunity, and a high quality of life.

Housing Affordability Leading the Way

One of the biggest drawcards for this State is its affordability. While housing prices across much of the country have risen, this standout location is the only major State to experience a decline in home prices over the past year. According to PropTrack’s Home Price Index, metropolitan areas saw a 1.46% decrease, while regional areas experienced a 1.74% drop.

The appeal extends to the rental market, where median weekly rents are just $550—lower than in any other State except Tasmania. For overseas migrants, who often rely on rental housing upon arrival, this affordability plays a crucial role. It’s no wonder that international migration accounted for 84% of this State’s population growth over the past year.

Where is Everyone Going?

The answer is Victoria. Known for its cultural richness, economic diversity, and world-class education institutions, Victoria is quickly becoming the destination of choice for Australians and overseas migrants alike.

Victoria’s diverse economy is a key driver, with industries such as manufacturing, financial services, healthcare, and social assistance creating robust job opportunities. The State’s top-tier educational offerings, including the University of Melbourne and Monash University, also attract thousands of international students each year. Many of these students stay on after graduation, adding to the State’s growing workforce and vibrant community.

Long-Term Growth and Challenges

Victoria’s population growth is forecast to outpace the national average over the next 50 years, with annual increases projected between 0.7% and 1.5%. Melbourne, Victoria’s capital, is set to surpass Sydney as Australia’s largest city within the next decade—a testament to the State’s enduring appeal.

However, this growth comes with challenges. Recent tax increases on property investors, including higher land taxes and surcharges for non-owner-occupied properties, have caused some investors to sell rather than buy. If this trend continues, it could reduce the availability of rental properties, pushing rents higher and potentially impacting the State’s appeal to new arrivals.

Balancing Growth and Opportunity

Victoria’s success lies in its balance of affordability, economic opportunity, and quality of life. While new home construction has helped moderate home prices, the rental market faces increasing pressure as investor withdrawals continue. Policymakers must work to ensure that housing remains accessible for both renters and buyers, supporting sustained population growth.

A Promising Future

Despite these challenges, Victoria remains one of Australia’s most attractive States. Its affordability, thriving economy, and cultural and educational opportunities position it as a leader in population growth and a beacon for those seeking a brighter future.

The State’s ability to adapt to the pressures of growth will be critical in ensuring its continued success. For now, Victoria’s story is one of resilience and opportunity—proof that the right combination of affordability, opportunity, and vision can transform a state into a destination of choice.

For further insights on property investment, avoiding common pitfalls and staying informed about market conditions. reach out to John Tsoulos or Frank Pennis at IFP Advisory on (08) 8423 6176. Your investment success depends on making informed, strategic decisions.

IFP Advisory is an Accredited ASPIRE Property Advisor Network advisor and all professionals are Qualified Property Investment Advisors (QPIA). Property investing is about purchasing a property that aligns with your goals and investment strategy. You should never be sold an investment. Know your numbers! If you invest wisely and strategically, the Australian residential property market can be a rewarding venture.