Bursting at the seams: Which suburbs are soaking up Perth’s skyrocketing population?

Inner-city suburbs are attracting an influx of working-age people while greenfield suburbs on the outskirts of Perth are absorbing tens of thousands of new residents as the state’s population booms.

It’s a stark difference to the east coast, with new analysis by KPMG Australia revealing that from 2019 to 2023, the eastern suburbs of Sydney and Melbourne experienced a 2.5 per cent reduction in their prime worker-aged populations (people aged 20-64) as Millennials were priced out of inner-city suburbs.

The inner-city suburbs are attracting an influx of millennials.Credit: Cameron Myles

In contrast, Perth has bucked this trend, with a 6.7 per cent increase in the working-age population in suburbs like Subiaco, Northbridge, Highgate and Claremont.

KPMG urban economist Terry Rawnsley said the inner-city suburbs of Melbourne and Sydney were seeing a decline in population simply because young people could not afford to live there.

“Brisbane and Perth have emerged as beacons of relative affordability, attracting an influx of working-age people,” he said.

“Instead of a population decline, Perth has experienced a surge due to its strong economy, liveability relative housing affordability.”

Rawnsley said Perth’s inner suburbs had seen rapid population growth as workers sought out job opportunities and more affordable living options.

“We have seen these urban renewal trends in Sydney and Melbourne over the past two decades and now Perth is following a similar path,” he said.

“These younger people bring a vibrancy and liveability which only helps to attract more people to Perth.”

Greenfield suburbs like Ellenbrook, Yanchep and Brabham also added tens of thousands of new residents between 2019 and 2023.

The bulk of these new residents have been working-aged families rather than the 65-plus cohort.

The analysis revealed almost every Perth suburb had increased in population between 2019 and 2023 except for Marangaroo which declined by 110 people.

In contrast, there was rapid population growth in Perth’s booming north-eastern and south-eastern growth corridors led by Alkimos-Eglinton which added 5367 new people between 2019 and 2023. It was followed by Piara Waters-Forrestdale (4873), Brabham-Henley Brook (4778) and Byford (4376).

“Families are increasingly considering greenfield developments in Perth where land is more readily available,” Rawnsley said.

“Yet, these areas come with their own set of challenges, such as access to essential services and employment.”

Rawnsley said the challenge for Perth now was to ensure additional housing supply helped keep Perth an affordable place to live.

Australian Bureau of Statistics figures released last week showed Western Australia’s population is months away from reaching three million people. WA had the fastest growing population, up 3.1 per cent in the 12 months ending March 2024.

Limnios Property Group managing director James Limnios said the population statistics, combined with the latest ABS residential building approval figures, painted a grim picture of the future supply of housing in the inner-city area of Perth.

Limnios said during the first month of this financial year, the inner-city area accounted for just 18 of the 1645 residential dwelling approvals for the Perth metropolitan area.

“That’s just 0.1 per cent of the future housing supply for our city during a time when we have a massive under supply of new homes,” he said.

“It is totally unacceptable that the major employment hub of our city has virtually no new housing developments in the pipeline.

“We need to urgently boost housing development in the inner and near city areas so that we bring much needed new supply into the market and start making homes in Perth more affordable as price inflation of housing surges.”

Limnios said a simple but effective way to kickstart housing development in the inner and near city areas of Perth was to remove the foreign buyer’s surcharge for off-the-plan developments within a 20-kilometre radius of the CBD.

“If this retrograde tax is removed for off-the-plan developments in the inner and near city area of Perth, it would result in an explosion of overseas investment in new housing developments that would in turn create a taxation bonanza for the state government in terms of future property taxation revenues these new homes would create,” he said.

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