Regional Australia has quietly become a $250 billion spending market, according to new CommBank iQ transaction data analysed for Boomtown, disproving long-held assumptions that the country's economic weight sits almost entirely in the capitals.
The research, covering the anonymised transactions of 17 million Australians through 2025, found regional areas account for 35% of national consumer spend and, in some categories, up to half of all spending in major states.
The shift is being driven by a sustained wave of metropolitan migrants, many of them millennials with young families, chasing more affordable housing and improved lifestyle without sacrificing city-level incomes through remote work.
"COVID was a tough time for everyone, but it really did accelerate regional migration," said Boomtown marketing lead Francesca Ryan (pictured). "We've seen that continue, and it's really driven by millennials, people who are starting families or have young kids and want more space and an improved lifestyle at a better price."
That migration is translating into real borrowing capacity and spending power once households relocate. Regional consumers outspend their capital city counterparts by 13% on groceries, 53% on hardware and home improvement, and 38% on active lifestyle categories, with regional Queensland ($76.2 billion) and regional NSW ($73.7 billion) emerging as the two largest regional markets nationally.
Ryan said the data challenges outdated assumptions about regional buyers.
"This report validates that regional Aussies are more like their metropolitan counterparts than they are different from them," she said.
Yet that strength at the regional level sits awkwardly alongside signs of national unease.
Separate ANZ-Roy Morgan data shows consumer confidence fell 2.6 points to 74.9 in the week to 31 August after the ABS reported higher-than-expected inflation of 3.5% for July, with sentiment now 13.1 points below the same week last year.
ANZ economist Sophia Angala said the reading has shifted the bank's own rate outlook: "Given persistent inflation and the resilience in household spending, we now expect the RBA to hike the cash rate by 25bp to 4.6% in November."
The survey also found only 18% of Australians believe their household finances have improved over the past year, against 50% who say they're worse off — a split that adds pressure to household budgets even as regional demand continues to hold up.
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