The 2011 census data released yesterday by the Australian Bureau of Statistics shows some key trends that your business can capitalise on.
Australians are moving west, we’re paying more rent, we’re not moving out of home and we’re all getting older.
The figures relating to these changes in Australia’s population all reveal opportunities for your business.
1. Go west
Go west in Sydney, west in Melbourne and west in Australia, as that is where the growth is.
Western Australia’s population grew at the fastest rate in the nation, swelling 14% in five years while Tasmania’s grew 4%.
Western Australia’s East Pilbara was the fastest growing locality, expanding 83% between 2006 and 2011. Almost four in 10 residents of the East Pilbara were born overseas, compared with the Australia-wide average of three in 10.
Perth has become a higher-income city than Sydney, boasting a typical household income of $75,868, a touch above Sydney’s $75,244 and Melbourne’s $69,316.
Darwin and Canberra are by far the highest earning capitals, typically taking in $93,912 and $99,840 per household. Hobart remains in last place with a typical household income of $55,380.
Even in the eastern capital cities the trend was westward, with Melbourne’s population increasing to 3,999,982, an increase of 9.7% from 2006, with the strongest growth in Wyndham, in Melbourne’s west, up 43.4% .
But, Phil Ruthven, chairman of IBISWorld, told SmartCompany the westward trend had been happening for a while and also warned that Melbourne was unlikely to become Australia’s biggest city any time soon.
“I am cautious about Melbourne becoming the biggest city. It is fast growing because the Victorian economy is doing better than the NSW as for too long the NSW government was in denial about opening up land and making it easier to build houses,” says Ruthven.
“I suspect Sydney will stay the biggest for most of this century, but nevertheless Melbourne is a very liveable city.”
2. Invest in a rental property
There are good returns to be found in rental property at the moment with median rental payments up by $95 per week between 2006 and 2011, according to the census.
This represents a 50% increase over the five-year period with the median national weekly rent is now $285 per week, compared with $190 in 2006.
The 2011 census also found that the proportion of households with rent payments greater than 30% of household income, the common definition of rental stress, rose slightly from 9.3% to 10.4%
3. Empty nesters are out: more people living at home is in
For the first time since European settlement, there has been an increase in the number of people per home.
One hundred years ago there were almost five people in the average home while today there are just 2.63 people per home. However, this represents a small increase from 2.61 people per occupied private dwelling in 2006.
“Presumably higher rents and mortgage repayments have resulted in more children staying home longer with their parents,” Craig James, economist at CommSec, said.
“At the same time, more seniors are probably also living with their children.”
4. Apartment living is on the rise
The proportion of people living in detached houses has fallen by one percentage point between 2006 and 2011, with a shift towards more people living in units and townhouses, according to census data.
In total, there are now 9,117,033 million private dwellings in Australia, up from 8,426,559 private dwellings counted in the 2006 census.
Of these private dwellings, 75.6% are separate houses, compared with 76.6% in the 2006 census, with proportional increases in the number of people living in a flat, unit or apartment and those living in a semi-detached, terraced house or townhouse.
5. Consumers have less cash in their pockets
Businesses have to work hard to get consumers to hand over their hard-earned cash as increased rental and mortgage costs mean they have less buying power than before.
Inflation may be low, which makes it look as if disposable income is holding up, but the really big expenses are soaring. The typical household rent has jumped 49%, the typical household mortgage payment 38 %, increasing by $500 between 2006 and 2011.
The standard variable mortgage rate stood at 7.8% in both the 2006 and 2011 census so increased payments appear to be a result of extra indebtedness rather than higher rates.
For 9.9% of households, their mortgage repayment was more than 30% of their income – the common definition of mortgage stress – up from 8.4% in the 2006 census.
However, Ruthven warns that the household income figures available from the census are limited in the application, as the highest income bracket is $100,000 plus, while the average household income in Australia is $128,000.
“I think we learnt practically nothing about household income in that census,” says Ruthven.
“It still astonishes me that they set the income bar so low and even below the average.
“It’s not giving you a real clue to where it is at.”