This month, Custodian welcomed back renowned demographer Bernard Salt for another Client Briefing, tackling a question on a lot of investors’ minds right now: should you still have confidence in the Australian property market, and in Victoria and Melbourne specifically, given everything that’s changed over the past 12 months?
Bernard’s answer, unequivocally, was yes.
Australia’s Global Position Is Only Getting Stronger
Bernard opened with UN population data showing the world climbing from 2 billion people in 1900 to 8 billion today, projected to add another 2 billion before plateauing around 2080. That’s a 25% rise in global demand for food, energy, resources and lifestyle, all things Australia is well placed to supply.
He backed this with a striking figure: 30 years ago, Australia ranked 19th out of 195 countries by GDP per capita. Today, with a population of just 28 million, we rank 10th, a climb built on decades of exporting resources and commodities, and channelling that prosperity into superannuation, lifestyle, and above all, housing. On debt, often raised as a concern, Bernard noted Australia’s gross debt sits at around 45% of GDP, comfortably below the OECD average.
Why Melbourne Specifically
Turning to Victoria, Bernard acknowledged it’s been a tough few years for Melburnians, but pointed to history: the state faced serious economic strain in the early 1990s and recovered. He highlighted Melbourne’s corporate depth, home to four of Australia’s top 10 ASX-listed companies including BHP and CSL, alongside strong private, tech, and manufacturing sectors.
Since the 2000 Sydney Olympics, Melbourne has consistently outgrown Sydney in population terms, at one point adding over 128,000 people in a single year pre-COVID. Bernard also flagged a shift underway: growth is flipping from the south-east growth corridors toward the north and west, around Melton, Wyndham and Werribee, creating fresh opportunities in newly developing estates.
What Millennials Actually Want
One of the most compelling parts of the discussion centred on housing preferences. Bernard described the “Lego effect”: once millennials have children, the inner-city apartment lifestyle no longer works, and demand shifts toward the “forever home,” a four-bedroom, two-bathroom house on a separate block.
While the share of Australians living in apartments has grown over recent decades, Bernard expects it to plateau at around a third, with two-thirds still preferring a standalone house and land, even as planning policy continues to push higher-density housing.
Jobs Are Following the Same Pattern
Aged and disability care remains the fastest-growing job category, driven by an ageing population and NDIS growth, alongside strong demand for nurses, software developers, and warehouse workers supporting online retail. Jobs remain concentrated in capital cities, led by Melbourne, Sydney and South East Queensland, though remote work is increasingly letting more people live further out without sacrificing career opportunities.
On the Recent Tax Changes
Asked directly about the impact of recent tax changes, Bernard was measured. His view: Australians are fundamentally rational, and while short-term reactions can be dramatic, medium to long term outcomes are still driven by the same forces, population growth on the demand side, constrained supply on the other. He also expects policy to keep being refined until it aligns with what middle Australia sees as fair.
The Takeaway
Bernard’s closing message was simple: Australia has what the rest of the world increasingly wants, Melbourne continues to outperform on population growth, and millennial-driven demand for houses and land shows no sign of slowing. For investors, the fundamentals underpinning long-term confidence in Australian property remain firmly in place.
