Australia’s Capital Cities Gain 373,000 Overseas Migrants Amid Housing and Infrastructure Strain

Migration boom keeps Sydney and Melbourne growing despite local exodus.

An aerial view of completed housing in a recently developed estate in Clyde North in the federal seat of Holt in Melbourne's south-east in Australia on March 26, 2025. Asanka Ratnayake/Getty Images

Despite slowing migration, Australia’s capital cities welcomed 373,000 international migrants in the year ending June 2024, underscoring ongoing strain on housing, infrastructure, and services.

Both Sydney and Melbourne received the largest share of overseas migrants by far with the Harbour City receiving 120,886 people, and Victoria’s capital welcoming 121,240.

This was followed by Perth (53,414), Brisbane (44,259), Adelaide (21,690), and Canberra (6,246).

Australia’s two largest cities saw a net decrease in domestic migration, meaning 7,581 individuals packed up and left Melbourne, while a whopping 41,086 people left Sydney in the past year.

However, these figures were offset by the sizeable overseas influx of migrants, as well as continued natural births—Sydney (27,738) and Melbourne (28,978).

Meanwhile, Brisbane welcomed the most interstate migrants at 15,567, followed by Perth with 8,078.

No other major city recorded a net increase in domestic migration.

Overall Growth Trends?

When overseas migration, domestic migration, and natural births are added together, Melbourne ends up with the largest increase in its population, gaining a net 142,600 people (2.7 percent over the previous year).

This was followed by Sydney (107,500 for 2.0 percent growth), Brisbane (72,930 for 2.7 percent), Perth (72,742 for 3.1 percent), and Adelaide (22,125 for 1.5 percent).

“Australia’s capital cities grew by 427,800 people last financial year, down from a record growth of 520,900 the previous year. This was largely driven by net overseas migration,” said ABS head of demography Beidar Cho.

Cities Growing At Nearly Twice the Rate of the Regions

Population growth remains concentrated in urban centres, with capital cities overall expanding at 2.4 percent, nearly double the 1.3 percent growth in regional areas.

Treasury projections released in December 2024 also suggest this urban bias will persist, with capital cities expected to outpace regional areas through 2034-35, heightening concerns over infrastructure and housing affordability.

Although growth is moderating after the pandemic-driven 2.5 percent surge in 2022-23, Australia’s population is still set to increase significantly.

Growth is forecast to slow to 2.1 percent this year and 1.2 percent by 2026-27, yet the population is projected to reach 28.4 million by 2027 and surpass 41.2 million by 2064-65.

While a more measured pace may ease short-term pressures, long-term planning remains crucial as capital cities continue to absorb the bulk of new arrivals, intensifying demand for housing, transport, and essential services.

Sydney’s Local Population Decline, While Queensland Gains

Soaring housing costs in Sydney have pushed more people toward Brisbane and regional Queensland, where living remains more affordable.

A May 2024 report, House Price Dynamics and Internal Migration Across Australia, highlighted this shift.

Between 2016 and 2021, Sydney recorded the largest population loss of any capital, with a net decline of 154,800 people—3 percent of its population. In contrast, Brisbane gained 54,400 residents, a 2.2 percent increase.

The report found regional areas also saw strong gains, Victoria’s Geelong, and Queensland’s Sunshine Coast and Gold Coast ranked among the top destinations for internal migration—cementing Queensland as the major destination for local migrants.

Housing and Cost of Living Drive Internal Migration

The report says housing affordability and cost of living remain key drivers of internal migration.

The House Price Dynamics report found that 51 percent of moves were housing-related, including upsizing, downsizing, or rental lease changes—mostly within the same city or region.

Family considerations were the second-most common reason, accounting for 22 percent of moves.

Long-distance relocations, including interstate migration, were primarily driven by family (35 percent) and employment (30 percent).

As capital cities continue expanding, urban infrastructure and housing availability will remain pressing challenges in the years ahead.