A quick snapshot of the recent September 2025 National Population data release indicates that the moderation in Australia’s rate of population growth is continuing, although there are emerging signs of stabilisation in key components.
National trends
Australia’s population increased by 423,600 people in the year to September 2025 to 27.72 million. While this remains strong by historical standards, it is broadly in line with the outcome to June 2025 and well below the peak annual increase recorded in late 2023, reinforcing the ongoing moderation in population growth.
The September quarter itself recorded an increase of 111,100 people, representing quarterly growth of 0.4%, which is consistent with recent quarters and suggests that the earlier sharp slowdown in population growth has begun to stabilise.
Across the states and territories, outcomes remain mixed. While most jurisdictions continue to record lower annual growth than a year earlier, there is evidence that the rate of decline has slowed. The stabilisation observed in New South Wales, Victoria and South Australia in mid-2025 appears to have continued into the September quarter.
Net overseas migration by state
Net overseas migration (NOM) remains the dominant driver of population growth, accounting for the majority of the increase over both the quarter and the year.
In the September quarter, NOM added 87,800 people, while on an annual basis it contributed 311,000 people, only marginally above the year to June outcome. Notably, the quarterly figure was an 8% increase on September quarter 2024, the first year-on-year increase since net overseas migration started falling from its peak in 2023. The rise also reflects the pick-up in net monthly overseas arrivals and departures that has emerged through the second half of 2025.
The quarter’s rise in NOM came from both a slight increase in arrivals and, more interestingly, a year-on-year decrease in departures. Departures have now recorded two consecutive quarters of year-on-year declines at a time when they would be expected to be increasing to reflect the return home of the earlier upturn in NOM arrivals.
Most states (NSW, VIC, QLD, SA and NT) recorded a corresponding increase in NOM compared to a year earlier, which may reflect their exposure to international student flows.
Overall, NOM appears to be settling at a level that remains elevated relative to long-term averages, but below the exceptional highs seen in 2022–2023.
The rise in NOM in the September quarter, together with more recent data indicating growth in net permanent and long-term arrivals and departures, suggests that NOM will stabilise in the low 300,000s range in 2025/26, above the NOM forecast of 262,400 in the Federal Government’s Population Statement published in January.
Net interstate migration
Interstate mobility continues to trend lower.
On an annual basis, net interstate migration remains subdued, with fewer people moving between states compared to a year earlier. This reflects the continued unwinding of the elevated mobility observed during and immediately following the COVID period, although absolute movements are now at more than decade lows.
Queensland and Western Australia continue to record net inflows, although these have softened compared to prior years. Rising housing costs and reduced relative affordability in these states are likely reducing their attractiveness as destination markets.
This moderation in inflows to the “sunbelt states” has benefited other jurisdictions. New South Wales has seen a further reduction in net outflows. At the same time, Victoria appears to be consolidating its return to positive net interstate migration following sustained post-COVID losses, while South Australia returned to a net inflow for the first time in nearly three years.
With interstate migration steadily balancing out across the states, it is becoming less of a driver of population redistribution.
Natural increase
Natural increase continues to provide a modest contribution to population growth.
In the September quarter, natural increase was 23,300 people, reflecting 75,500 births and 52,300 deaths. On an annual basis, natural increase totalled 112,600, broadly in line with the June quarter outcome.
Births in the quarter were slightly lower compared to a year earlier, although further data is required to see if this becomes the trend after the modest recovery observed through 2024 and early 2025. The total fertility rate remains low by historical standards, and structural factors, including affordability constraints and demographic ageing, continue to limit any sustained rebound.
Deaths remain elevated relative to pre-pandemic norms, reflecting Australia’s ageing population. As a result, natural increase remains well below pre-COVID levels and is unlikely to materially accelerate in the near term.
Implications for dwelling demand
Based on current population growth, underlying demand for new dwellings remains elevated, although it has eased from the peak levels recorded in 2023.
Annual population growth of around 424,000 people implies dwelling demand broadly in line with recent estimates of around 190,000–200,000 dwellings per annum, depending on household formation assumptions. This remains below the peak in 2023 but continues to exceed current levels of housing completions.
As a result, the cumulative housing shortfall continues to build, maintaining pressure on rental markets and broader housing affordability.
Australia’s sustained population growth contrasts with that of Canada, where changes to immigration policy saw population actually decline in calendar 2025 (link). It will be interesting to compare the outcomes of these contrasting policies in the coming years.
For further insight into the implications of population growth nationally and across the states, contact Angie Zigomanis at [email protected] or Rob Burgess at [email protected]
