A new study has identified the population “sweet spot” where a city is most sustainable and liveable, pinpointing the balance at which housing, jobs, transport and services operate in sync.
The Monash Institute of Transport Studies analysed 655 Australian cities and found sustainability peaks when a city’s population sits within four per cent of its ideal capacity.
Cities operating inside this narrow margin reported significant benefits, including average annual rental savings of $1,560 per household — amounting to $5.3 billion nationally — with 44,000 additional residents able to walk to work and 275,000 fewer households needing multiple cars.
The research revealed clear distinctions between cities at, above or below their ideal population.
Perth and smaller regional hubs such as Port Pirie were found to be operating near their optimal size, while Melbourne and the Gold Coast were overstretched, facing higher costs and pressure on infrastructure.
Smaller towns offered affordable rents and more walkable commutes but had higher car reliance, while mid-sized cities performed well in train access yet suffered relative isolation.
Lead author Associate Professor Liton Kamruzzaman said the findings could help shape planning strategies for both existing and new cities.
“When a city grows too big, the signs are clear; longer commutes, traffic jams, soaring rents, and overcrowded services,” Associate Professor Kamruzzaman said.
“But when it’s too small, valuable infrastructure and opportunities go to waste.”
He said the study developed a model based on four measures of urban function — capital city status, job accessibility, service mix and connectivity — to determine the population ranges where a city’s systems operate most effectively.
“Using this research as a benchmark new cities could be designed with a population range that avoids the pitfalls of over- or under-capacity, while existing ones can be recalibrated through policy levers like transport links or decentralised jobs.”
Kamruzzaman cautioned against ranking larger and smaller centres against one another.
“This study shows it’s not about being large or small,” he said.
“It’s about whether a city’s population matches what its systems can handle.
“That’s the key to sustainability.”
The study suggests planning should move away from blunt growth targets towards more nuanced strategies, including stronger transport networks, improved land-use rules and policies to better distribute jobs.
