Population growth in south-west Victoria has dropped for the first time in 10 years, according to latest estimate figures.
Australian Bureau of Statistics (ABS) data released on Tuesday showed Warrnambool and Moyne were the only two council areas in the region to experience population increases. The local government areas (LGA) gained 85 and 198 residents respectively in 2021.
However, declines in other south-west LGAs including Corangamite, Colac Otway, Glenelg and Southern Grampians meant the region's net population dipped by 0.1 per cent overall.
Warrnambool's population increase rate slowed from 2020-21 as growth numbers dropped from 318 in 2018-19, and 341 in 2019-20, to 85 in 2020-21.
Moyne Shire experienced a rise in 2020-21 with a population increase of more than double the amount it had in 2018-19 and 2019-20 whereas Corangamite Shire's population rate continued its downward trend with a 0.7 per cent decline in the past year.
The 2020-21 trend in the south-west contrasted to other regional areas across Victoria and Australia which had population upticks due to migration from the capital cities during the COVID-19 pandemic.
According to the ABS, Melbourne lost 60,500 people in the past year as regional cities including Geelong, Ballarat and Bendigo experienced internal migration rate increases.
ABS Demography said the south-west region's population decline was mainly attributed to a drop in overseas migration from international border closures.
"In 2020-21, there was a net overseas migration loss of 100 people, compared to a gain of 400 people the previous year," they said.
"The other components of population change (natural increase and internal migration) were similar over the last couple of years."
Corangamite Shire mayor Ruth Gstrein said the main issue affecting population numbers in her council area was housing availability.
"We do not have the housing available for those people wishing to move to our towns and communities to live and work," she said.
"We are aware of this significant barrier to population growth which is why we have worked to develop our Unlocking Housing projects in Simpson and Timboon, our structure plan work in Cobden and our Residential Living strategy for Camperdown, Terang and Cobden."
Cr Gstrein said the ABS figures were only estimates and did not seem to reflect what her council was "seeing on the ground in terms of increasing housing sales and lack of rental properties".
The Demographics Group director Bernard Salt said the region's population decrease may also be due to "farm aggregation" which usually occurred in south-west areas including Glenelg and Corangamite.
"Those areas generally have modest population losses from one year to the next," he said.
"One farmer buys out their neighbour and farms need to be bigger so they can be more productive.
"The labour that was once scattered throughout that area then drifts off to a major city like Warrnambool, Ballarat, Geelong or Melbourne."
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Mr Salt said the population decrease was not completely representative of the region and did not think it indicated a long-term trend.
"It's affected by students and backpackers going home," he said.
"With borders opening, it is likely that number will go into the positive next year.
"What (the decline) is really saying is it's a very stable community, and reflects the predictability of the agriculture and climate of the region."
Mr Salt said internal migration from Melbourne to its surrounding regional areas was likely "overspill" and cities including Warrnambool were too far for residents who moved to the regions, but needed convenient access to the cities.
"With the pandemic, you can move out of Melbourne, take your job with you, because you can work from home, and live on the South coast, live in Bannockburn on acreage, or live in Ballarat and then get back to Melbourne once every two weeks or every week," he said.
"Warrnambool is a step too far for people that have left the capital city but still need to be in the office occasionally."
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