Melbourne’s population growth in the three financial years to June 2025 was driven overwhelmingly by overseas migration, with net overseas migration accounting for about 86 per cent of the city’s total population increase, according to an analysis of Australian Bureau of Statistics (ABS) data by the Institute of Public Affairs.

The IPA analysis found that Melbourne’s population increased by 407,170 people between the financial years ending June 2023 and June 2025.

Of that increase, 349,476 people were added through net overseas migration, while natural increase — the number of births minus deaths — contributed 86,580 people.

At the same time, Melbourne recorded net internal migration of -28,886, indicating that more people left Melbourne for other parts of Australia than moved into the city from elsewhere in the country.

The figures mean overseas migration contributed substantially more to Melbourne’s population growth than natural increase during the three-year period.

Dr Kevin You, Senior Fellow at the Institute of Public Affairs, said:

“Melbourne has been growing faster than any other part of Australia on the back of unprecedented overseas migration in the immediate years following the Covid-19 pandemic.”

The analysis also found that Melbourne received more than a quarter of Australia’s net overseas migrants during the period.

Of the 1,272,315 net overseas migrants recorded nationally across the three financial years, 349,476 settled in Melbourne, equivalent to about 27 per cent of Australia’s total.

Capital cities remained the dominant destinations for new overseas migrants.

According to the IPA analysis, 1,088,959, or 86 per cent, of Australia’s net overseas migrants settled in capital cities, with Sydney and Melbourne together accounting for more than half of the national total.

Sydney received 352,874 net overseas migrants during the period, slightly more than Melbourne.

The population figures also reveal a contrasting movement of existing residents away from Australia’s two largest cities.

Net internal migration from Sydney and Melbourne was negative, with residents moving to regional areas and other capital cities.

In Melbourne’s case, the net internal migration figure was -28,886.

The analysis identified regional Victoria, including Geelong and Ballarat, as among the destinations for people leaving Melbourne. Other significant destinations included Brisbane, regional Queensland and Perth.

The movement was not entirely one-way. Melbourne also attracted people leaving Sydney, with the analysis finding that 11,368 former Sydney residents moved to Melbourne between 2023 and 2025.

Dr You said the figures showed a significant change in the composition of Melbourne’s population.

“Net overseas migration to Melbourne has been four times the size of its natural increase in the three financial years immediately after the pandemic,” he said.

“Over that period, former Melburnians have been leaving the city, significantly changing the composition of Melbourne’s population.”

The regional breakdown shows that the Melbourne-West region recorded the largest population increase, with 95,939 people, including 53,702 through overseas migration, 28,692 through natural increase and 13,545 through internal migration.

Melbourne’s inner region recorded population growth of 79,693, including 89,193 people through overseas migration. However, that growth was offset by a net internal migration loss of 17,305 people.

Melbourne’s South East recorded population growth of 74,977, with 65,288 attributed to overseas migration and a net internal migration loss of 9,376.

The pattern was also evident in Melbourne’s Inner East, where overseas migration contributed 34,695 people while internal migration fell by 8,606.

Across Victoria, the IPA analysis recorded 374,936 net overseas migrants, compared with a natural increase of 94,724 and net internal migration of -11,033, producing overall population growth of 458,627.

The analysis also examined the relationship between overseas and domestic migration through a measure described as the net overseas-to-domestic arrival rate (NODAR).

For Melbourne, the NODAR was -0.08, reflecting the combination of substantial overseas migration and a smaller net outflow of existing residents.

Sydney recorded a considerably lower NODAR of -0.32, meaning that, in net terms, about 32 residents left for every 100 overseas arrivals during the three-year period.

The IPA said the figures demonstrated that Australia’s post-pandemic population growth was concentrated heavily in major capital cities, despite continuing movement by existing residents towards regional areas and other states.

Dr You argued that migration policy should take greater account of where population growth is occurring and where infrastructure and employment demand are greatest.

“Migration has been an important part of Australia’s national story,” he said.

“But immigration needs to be properly planned, have the consent of the community, and be targeted towards areas of economic need.”

The findings come as Victoria continues to face debate over population growth, housing affordability, infrastructure capacity and the state’s economic performance.

The IPA’s 2026 State Economic Scorecard ranked Victoria second last among Australia’s six states, citing weak per-capita economic growth, subdued wage growth and high tax and debt burdens.

The population figures, however, do not establish that overseas migration itself caused these economic or housing pressures. They show the respective contributions of overseas migration, natural increase and internal migration to population change.

The IPA analysis is based on ABS regional population data for the financial years ending June 2023, June 2024 and June 2025.

Support our Journalism

No-nonsense journalism. No paywalls. Whether you’re in Australia, the UK, Canada, the USA, or India, you can support The Australia Today by taking a paid subscription via Patreon or donating via PayPal — and help keep honest, fearless journalism alive.