Federal immigration settings driving Melbourne's record population growth

Melbourne received 145,000 net overseas migrants in the past year under federal immigration settings, the highest annual figure ever recorded for the city and the primary driver of its overtaking Sydney as Australia's most populous metropolitan area. The intake reflects both the high volume of international student arrivals — Melbourne hosts the largest international student population in the country with more than 220,000 enrolled students — and strong skilled migration flows into the state's technology, health, construction, and professional services sectors.

Federal Immigration Minister Tony Burke defended Melbourne's high intake as consistent with Australia's national interest, noting that the immigration program was the most significant contributor to addressing the chronic labour shortages across multiple sectors that threatened the quality of services Australians relied on. "Melbourne is growing because skilled people want to be here and because we need them," he said.

Melbourne's business community broadly supports the immigration settings but has identified housing as the critical constraint on sustainable growth. The Property Council of Australia's Victoria chapter noted that the gap between Melbourne's population growth rate and its housing construction rate had widened for three consecutive years, contributing to rental vacancy rates at historic lows and rental price increases well above inflation.

The federal government's National Housing Accord targets, which commit all state and territory governments to ambitious dwelling construction volumes, are partly in response to this dynamic. Victoria's target of 800,000 new dwellings over 10 years is the most ambitious of any state, requiring construction rates approximately 40 per cent above recent historical levels.

Federation of Ethnic Communities' Councils of Australia chief executive Mohammad Al-Khafaji said Melbourne's multicultural character, already the most diverse of any city in Australia, was being further enriched by the immigration intake and required investment in settlement services, language support, and community infrastructure to realise its full social and economic potential.

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