Money has become the primary driving factor pushing Australians to move
According to a recent report by removalist booking platform Muval, Australians are being greatly impacted by the cost-of-living crisis, leading many to relocate in order to alleviate financial burdens or pursue more lucrative job opportunities and affordable housing.
The 2023 Muval Index revealed that money has become the primary driving factor behind relocations. In fact, more than a third (35%) of relocations in 2023 were motivated by the desire to reduce the cost of living. This marks a significant increase from the previous year, when only 11% of movers cited reducing their cost of living as their reason for relocating.
This also marks a departure from the main reason Australians moved in 2022, which was to upgrade their homes (30% in 2022 compared to 16% in 2023).
Aside from cost-of-living concerns, work opportunities played a major role in Australians' relocation decisions this year. Approximately 29% of moves were motivated by work, with 57% of those moves driven by the prospect of higher income. Other economic factors, such as more affordable housing (14%) or a cheaper lifestyle (12%), also influenced a significant portion of relocations.
The research conducted for this year's Muval Index also revealed that rising rents and interest rates had prompted Australians to move at twice the usual rate. In the past 12 months, nearly one in five survey respondents (18%) indicated that increased rent or interest rates had compelled them to relocate. This is nearly double the average of 10% of the population that typically moves in any given year.
Rent increases
Young Australians have been particularly affected by rent increases, with 22% of those forced to move due to rental hikes in the past 12 months falling within the 18-24 age range, the report found. This is followed by 18% of 25-34-year-olds, which is roughly double the national average of 11% for moves prompted by rental increases. The rental squeeze and rising interest rates have had the most severe impact on Victorians, with 13% of those who moved in the past year doing so because of rent increases, and 10% due to rising interest rates. This is twice the rate of other major states, such as New South Wales, Queensland, South Australia, and Western Australia, where the corresponding rates range from 5% to 7%.
While the majority (64%) of moves driven by financial concerns were within the same city, a significant portion of individuals (22%) were forced to relocate to another city, and 9% even crossed state borders, Muval said. Among those uprooting their lives in response to housing cost increases, young Australians accounted for a large portion. Approximately 30% of those who moved to another city due to rent or rate hikes were between the ages of 18 and 24, followed by 27% in the 25-34 age group. Baby boomers (14% of those aged 65+) and middle-aged Australians (25% of those aged 45-54) were most likely to make interstate moves for more affordable housing after experiencing rent or rate increases.
Couch surfing on the rise
The report also highlighted a rise in the number of Australians resorting to couch surfing as a result of housing affordability issues. About 16% of Australians reported either moving in with family or friends or having others move in with them to ensure they had a roof over their heads. Unfortunately, this phenomenon has disproportionately affected young Australians, with 60% of couch surfers falling within the 18-34 age group.
The data from Muval's research indicated that Queenslanders were the most likely to stay within the same city (80%) when making a move driven by financial considerations. In contrast, only 33% of Western Australians who relocated for monetary reasons stayed within their city, with a significant portion (29%) choosing to move to another state. South Australians were most inclined (29%) to move to regional areas. Similarly, a significant number of individuals from New South Wales (25%) and Victoria (27%) moved to other cities following rent or rate increases.
Home purchases
Despite the challenges posed by the current rental crisis, some individuals found an opportunity in the form of purchasing a home after experiencing rent increases. Approximately 11% of respondents bought a house after their rent was raised, with the majority (73%) making this transition in the past two years, Muval reported.
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New South Wales residents were particularly opportunistic, with 13% of those who purchased a house after a rent hike belonging to this state. However, the majority of Queenslanders and South Australians (above 90%) chose to continue renting despite record rent increases. Among those who took the plunge into homeownership over the past 12 months, 42% were middle-aged Australians (aged 45-54).
Looking ahead
Looking ahead to the new year, reducing the cost of living emerged as the top resolution for Australians considering a move in 2024 (16%). This was followed by aspirations for a better lifestyle (15%) and more affordable housing (10%).
Interestingly, a survey conducted by Muval also revealed that what most Australians want for Christmas is a $50,000 increase in salary. One in four (25%) Australians expressed their willingness to move if offered such a pay rise.
Men appeared to be more motivated by financial gain, with 27% desiring a significant salary increase compared to 23% of women. On the other hand, women were more inclined to move for a better lifestyle (16% vs. 12%) or cheaper cost of living (14% vs. 8%) rather than a larger bank account.
Among the major states, South Australians (32%) were the most likely to move for a $50,000 pay rise, followed by Western Australians (27%) and Queenslanders (25%). Interestingly, a fifth of Western Australians (19%) were content to stay in their current location with their current wage, as long as it was a more affordable area. This was twice the proportion of any other state.
James Morrell, CEO of Muval, acknowledged that the cost-of-living crisis was undoubtedly triggering a nationwide relocation trend, with Australians willing to take significant measures to alleviate the pressure.
“Over the past 12 months we’ve seen a dramatic increase in both interest rates and rents throughout the country – we’re now sitting at a 12-year high for rates, and rents have skyrocketed to record amounts in recent months,” Morrell said. “Many Australians have hit the end of the road and with no buffer left, they have no choice but to make a big change as they seek out more affordable options.”
“What a difference a year makes. This time last year Australians were moving to upgrade their home, and this year moves are based on one thing – affordability,” he said. “The 2023 Muval Index shows how much inflationary pressures have changed Australians’ outlook in the space of a year and what they are having to do to keep a roof over their head – whether it’s moving to a new suburb or city where housing is more affordable or accepting a job that’s paying more money, even if it means packing up the family and relocating to a different state. Our data is telling us that moving is one way that Australians are combatting the rising cost of living in 2023 and the great money migration will continue into 2024.”
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