The scene has been set for another strong year of growth in Victoria, on the back of a perfect storm of robust economic factors, commercial construction and government investment.
John Marasco, Colliers International State Chief Executive – Victoria, said the dual decline in interest rates and the Australian dollar had lifted investment and tourism in the state, while population growth has generated steady levels of consumer demand.
Victoria’s population growth is being driven by both interstate and offshore migration, recording the highest growth rate of all states and territories at 2.4%– well above the national population growth rate of 1.6%.
“The state’s population growth is having a broad scale effect on economic trends across the property market, with the flow of migrants contributing to strong white-collar job creation,” Mr Marasco said.
The positive trajectory of the local labour market was likely to continue, with Victoria’s job vacancies had climbed steadily from 2014 to reach 57,500 in the latest data release, the second highest in the nation behind New South Wales.
As Victoria’s labour market improves, so too does wage growth which is currently the highest in the nation at 2.2% annually, up from 2.0% in the prior quarter.
“Commercial construction has supported growth over the last year, while state government investment is also supporting growth via new transport infrastructure projects,” Mr Marasco said.
“There are around $13billion worth of transport projects that are under construction, compared to an impressive pipeline of $37billion.
“One of the most significant projects is the Melbourne Metro Tunnel Project which will transform Melbourne’s rail network into an international-style metro system to be completed by 2026.
“In recent years, we have seen train networks play a part in the growth of an area bringing in further investment and land use development and creating new hubs of activity."