Australians Turning Away from CBDs Amid Cost‑of‑Living Pressures
Recent research shows a noticeable shift in how Australians interact with their urban centres, driven by rising living expenses and changing lifestyle preferences.
Survey Highlights
Data collected by Square reveals that a growing share of the population is opting for local neighbourhoods over traditional city‑centre destinations.
More Aussies than ever before are avoiding the major city centres, with nearly 20 per cent saying they avoid the CBD altogether, a new study claims.
Around 40 per cent of Australians said they visit the CBD for things like shopping, dining or other activities less than once a month, with one in five refusing to go at all, a study from Square claims.
Using transaction data from 2019 to the end of last year, it found residents of Sydney and Melbourne are looking to shop more locally, with spending in Sydney’s CBD dropping by four per cent, and in Melbourne CBD dropping by 39 per cent.
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Businesses in CBDs across Australia are being hit by a lack of foot traffic. Supplied
It is a trend that began during the COVID-19 pandemic when Australia’s big cities were hit by lockdown, but it has continued to become a common theme of city life.
The increasing cost of living pressures are contributing to Aussies becoming more insular, with 68 per cent of Aussies surveyed by Square claiming they are seeking more affordability by looking closer to home when doing their weekly shopping and other activities.
Outlets in the suburbs are seeing a surge in traffic and earnings as a result, with people choosing to remain close to their homes when spending time with family and friends, or when choosing to dine out.
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Around 78 per cent of Aussies look to spend time with friends and families locally, with 75 per cent meeting up at cafes in their local postcode, and experts believe smaller businesses are cracking the code in bringing customers back time and time again.
“City centres depend on traffic while neighbourhoods depend on loyalty,” Head of Account Management at Square David Schnabl said.
“Someone who pops in every week is far more valuable than someone who splurges once and doesn’t come back. The smart play in 2026 is simple: give people a reason to return.”
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Workers cross the street in Sydney’s CBD. Trade at CBD venues in Sydney has fallen by four per cent since 2019. iStock
Like businesses in the CBD, Schnabl said they aren’t immune to the economic pressures forced by interest rate rises and the uncertainty of the war in the Middle East, but said businesses in the suburbs were better placed to bounce back than those in the CBD.
“The suburbs aren’t slowing down, they’re finding their rhythm,” he said.
“The businesses that become part of that rhythm will be the ones that thrive.”
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Overall, the movement toward suburban shopping and socialising reflects a broader desire for convenience, community connection, and financial prudence.
For further details on the study and its implications, see the original report Here.
