The drift away from Australia's capital cities has reached its strongest point on record, with new data showing regional living is not a post-COVID blip but a deepening structural shift that is reshaping where Australians want to borrow and buy.
The Commonwealth Bank and Regional Australia Institute's Regional Movers Index (RMI) for the March 2026 quarter recorded its highest reading since the index began, jumping 20.1% on the December 2025 quarter and 4.7% higher than a year earlier. Capital city residents moving to regional Australia outnumbered those making the reverse journey by 29.7%.
The timing is significant — capital city home prices are forecast to finish 2026 essentially unchanged, with Sydney and Melbourne declining for three consecutive months, while regional markets continue to benefit from population inflows.
RAI CEO Liz Ritchie said the data confirmed the trend was not slowing.
"Australians are continuing to choose regional life in greater numbers, even as economic conditions shift. Across COVID, inflation, housing pressures and tight labour markets, the trend has been remarkably consistent — people are leaving capital cities for regions, and they're doing so at increasing rates," Ritchie said.
Sydneysiders and Melburnians continue to account for the largest share of capital outflows — 55% and 36% respectively — but their combined dominance is shrinking. Brisbane, Perth and Adelaide all recorded an increased share of net outflows this quarter, signalling that regional migration is no longer an east-coast phenomenon.
The Sunshine Coast held its position as the most popular destination with 8.8% of total net migration, while Greater Geelong, Fraser Coast, Moorabool and Lake Macquarie rounded out the top five. Toowoomba was the standout growth story of the quarter, recording a 236% increase in net inflows from capitals compared to the same time last year — the strongest year-on-year gain of any local government area in Australia.
Population growth of this scale typically precedes a lift in first-home buyer and upgrader activity. PropTrack data shows more than 70% of those moving to regional areas are homeowners, underpinning stronger purchasing activity and price growth in destination markets.
Kylie Allen (pictured), CBA regional and agribusiness banking executive general manager, said the record result reflected deliberate, long-term decisions rather than short-term shifts.
"This is a significant milestone, and the data shows Australians are making long term, considered decisions to build their lives in regional communities," Allen said.
Regional businesses are already responding — CBA's own lending data shows businesses investing to support larger populations and increased economic activity across their regions.
Ritchie flagged the data's practical use for those tracking emerging hotspots.
"We're not just tracking movement but providing early indications of where regional growth is emerging, so government, investors, industry and communities can respond before pressure builds," she said.
Beyond the established names, brokers active in Mid-Coast NSW, Broome, Townsville and Tasmania's Meander Valley are among the emerging markets where population growth is arriving ahead of broker coverage.
Read the full CBA Regional Movers Index report, March Quarter 2026.
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