Look out, Sydney! Here comes Melbourne!

In one corner, we have Sydney, the capital city of New South Wales. In the other corner, there's Melbourne, the capital of Victoria. The rivalry between the Australian cities is intense, and it's going to intensify because a new report suggests that the Victorian metropolis will overtake its more famous New South Wales counterpart as Australia's largest city by 2040.

The main reason is that Victoria is attracting immigrants in record numbers and building new homes at twice the rate of New South Wales. Right now, there are about half a million more people in Sydney than there are in Melbourne — but that's going to change, says the report by the business research company BIS Shrapnel.


The report, titled "Going Nowhere", says that from 2020 onwards New South Wales will face the demographic challenge of an ageing population, lower immigration and "a greater likelihood economic growth will decline alarmingly". Meanwhile, Melbourne, which is seen as an increasingly attractive urban option for young families and immigrants, will grow and its population will climb to 5.7 million by 2037, says the report.