South Australian, Victorian and Queensland regional areas are experiencing a five year high of regional growth, with young families leading the change.
Figures released from the Regional Movers Index report released by the Commonwealth Bank and the Regional Australia Institute (RAI) showed the number of people moving to regional areas rose by 16.6 per cent, almost doubling pre-pandemic levels.
South Australia tops the list with three councils showing a huge demand of growth in the local government areas of Ceduna, Mount Gambier and Port Augusta.
Ceduna has the biggest annual net migration growth, with doubling of growth compared to the previous 12 months with a 114 per cent change.
Mt Gambier (85pc), Port Augusta (74pc), Queensland's Western Downs (56pc), and Victoria's Moorabool shire (56pc) are all showing that the spread outwards from the metropolitan centres are sprawling even further.
Commonwealth Bank regional and agribusiness banking executive general manager Paul Fowler said businesses in regions are the major benefactor from the population growth.
"In Cairns, Townsville, through to Coffs Harbour, Port Macquarie, down to Ballarat, Bendigo, we're seeing a number of centres really benefit from population growth and for those smaller cities and towns and communities," he said.
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He also said a growth in lending to those in agriculture sector is an indication the industry is thriving and that is trickling through manufacturing and hospitality industries.
"If I think about the Commonwealth Bank's lending into the agricultural community and their training in excess of 15pc growth year on year, and we're seeing broad based businesses really thriving in these conditions," he said.
Mr Fowler said labour shortages and input costs were challenges, but the vast majority of agricultural banking customers are really benefiting from the broader economic conditions.
He said that the data showed that there was a need to invest in local regional communities to improve social infrastructure, and lesson the amount of those who live in the regions and then travel to larger metro areas for work.
"As we see the migration trends to the regions, the opportunity to invest in in local communities and to social infrastructure, to really build thriving communities is exciting," he said.
"The lion's share as we see it is people investing in a local community, bringing their children into the local schooling system, investing more local sporting clubs.
"It provides opportunities for the broader social infrastructure around health care, and education."
RAI chief economist Kim Houghton said there seemed to be a consensus that people knew what country living was like, as the overall migration to the regions has been trending upwards for nearly 15 years.
"Most of our regional towns, about typically about 20pc of the population will be turning over every five years," Dr Houghton said.
"We're a very mobile country by international standards, so that notion that [people have] a one off move, and people will stay in a place like Moorabool for the rest of their lives - it hasn't happened."
Dr Houghten said labour shortages some constraints are being placed on those moving to regions like labour and "employers are still struggling to find the skill match and workers that they need".
The index also showed a slight trend upwards of people in regions moving to capital cities, now that lockdowns are a thing of the past, which Dr Houghten says may help to alleviate peak tension in the housing market.
In the March 2022 quarter, these movers accounted for a 4.6pc share of total internal migration, higher than their previous quarter, which was at 4pc.
For the first time, the index also tracked demographics, and millennials (aged 24-40) made up the biggest proportion of people moving to regions.
In Victoria, Moorabool also attracted a relatively high proportion of those in the generation x category (aged 40-56) at 24 per cent.
The biggest outflows were from Sydney and Melbourne with most those movers heading to regional NSW, Queensland, and Victoria.
