Melbourne, 2011–2021: closing on Sydney, with India now its largest overseas birthplace

Between the 2011 and 2021 Censuses, Melbourne grew faster than Sydney, Brisbane, Perth or Adelaide. Much of that growth came from migrant families, increasingly from India, settling in new suburbs on the city's edge. The result is a city whose fastest-growing neighbourhoods look different from its established ones, and a market that is closing on Sydney in size while staying cheaper to live in.

A second city that is catching up

Melbourne grew by 23% over the decade, from 4.00 million to 4.92 million residents, against 19% for Sydney. That is about 918,000 extra people, compared with Sydney's 840,000. On Censible's projections Melbourne reaches about 5.44 million in 2026 and 5.85 million in 2031, while Sydney reaches about 5.98 million in 2031, cutting the gap between them from 314,000 to around 130,000.

For anyone planning a national store network or sizing a market, the gap in size between the two cities is now small enough that the choice between them rests more on other figures, such as incomes, housing costs and where each city is growing.

The growth is on the edge, and it is families

Twelve outer areas, including Wyndham, Melton, Casey, Cardinia and Whittlesea, held 18% of Melbourne's residents in 2011 but took 54% of its growth. They are distinctly family areas: in 2021, 24% of their residents were under 15 against 18% across the city, and households averaged 3.05 people against 2.60.

So the demand Melbourne is adding is weighted towards children and larger households: schools, childcare, family-sized homes and the weekly grocery shop, located a long way from the established middle-ring suburbs where much retail and service capacity already sits.

Who is moving in

India has been Melbourne's largest overseas birthplace at the last two censuses. The India-born population rose from about 107,000 in 2011 to 242,000 in 2021, or from 2.8% to 5.2% of residents, a higher share than any other capital (Sydney's is 3.7%). Punjabi went from 0.8% to 2.1% of residents and is now the fourth most common language at home, after Mandarin, Vietnamese and Greek.

The arrivals are concentrated where the growth is. In the twelve outer areas the share of residents born overseas rose from 31% to 41%, overtaking the city average of 37%, and in Wyndham – North more than one resident in five was born in India. The new estates of the west are being settled largely by migrant families, so a picture of new-suburb households drawn from older estates is likely to be wrong about the store ranges and formats they use and the languages services need to reach them in.

Old and new multicultural Melbourne

Melbourne's post-war migration has not disappeared; it has changed form. Greek at home fell from 3.0% of residents to 2.2% and Italian from 3.0% to 1.8% over the decade, yet 3.7% of Melburnians still give Greek as an ancestry, the highest of any capital, and 7.0% give Italian.

The city therefore holds two multicultural markets: an established one of second and third generations who identify with a heritage but mostly speak English at home, and a recent one of first-generation households that are more likely to use another language and to be raising children on the fringe.

Better paid, and still cheaper than Sydney

Melbourne's median weekly household income rose 44% over the decade, to $1,919, almost exactly matching Sydney's 45% and well ahead of Brisbane's 34% and Perth's 29%. Housing costs did not keep up with Sydney's: in 2021 the median mortgage repayment was $2,023 a month against $2,489, the median rent $388 a week against $472, and 31% of households rented against 36%.

Measured against income, housing takes less in Melbourne: the median mortgage repayment equals about 24% of the median household income, against 27% in Sydney, and the median rent about 20% against 23%. In dollars, a Sydney household still keeps slightly more after housing because its income is higher, so day-to-day spending power is broadly similar. The difference is in the cost of entry: smaller repayments make owning a home in Melbourne reachable on a lower income, which is a plausible part of why it drew so many new residents, though the census on its own cannot show why people moved.

A workforce level with Sydney's

The share of adults with a bachelor degree or higher rose from 24% to 33%, almost exactly Sydney's share and well ahead of Brisbane, Perth and Adelaide at 26–27%. For employers, the depth of the graduate workforce is no longer a reason to choose Sydney over Melbourne for professional roles. If the last decade's trend continues, about 44% of adult Melburnians would hold a degree by 2031.

What to watch in the 2026 Census

Three questions will decide whether this picture holds. Did growth stay on the fringe after 2021, or did the inner city recover as international students returned? Did migration from India keep its pace? And did the rise in rents after 2021 close Melbourne's cost gap with Sydney? The first 2026 Census results arrive in June 2027.

Method

Figures are for Greater Melbourne and the other Greater Capital City Statistical Areas from the 2011, 2016 and 2021 Censuses, carried onto the ABS's 2026 boundaries with ABS correspondences so each city is compared on the same ground. The twelve outer areas are the SA3s on the northern, western and south-eastern edges with the largest growth. SA3s are ABS statistical areas that group several suburbs, usually with 30,000 to 130,000 residents each, and the figures for the twelve are calculated from summed counts. Population projections grow census counts with ABS estimates and Geoscience Australia projections; the degree projection follows the recent trend. More on the method is on Data and sources.

Limitations

• The 2021 Census was taken during lockdowns with international borders closed, which lowered counts of international students and temporary residents, particularly in the inner city.
• Dollar figures are nominal, and comparisons of housing costs with incomes use each city's medians rather than individual households' circumstances.
• Most of the outer areas had boundary changes between editions, so their 2011 and 2016 figures are estimates.
• The census shows where people live and who they are but doesn't record why they moved, and statements about what the figures mean for businesses are interpretation.
• Figures for 2026 and 2031 are projections, and the 2026 ones will be replaced by census counts as the ABS releases the 2026 results from June 2027.