Millennials account for nearly three-quarters of those moving to South Australia's second-largest city, sparking calls for more appropriate housing to match the needs of the new arrivals.  

Data from the Regional Australia Institute shows 70 per cent of the people moving to the Mount Gambier local government area during the March quarter were millennials. 

The institute's chief executive officer, Liz Ritchie, said the influx was a result of more affordable housing and more job opportunities. 

In addition, 17 per cent of people moving were from Generation Z (born in the mid-to-late 1990s) and Generation Alpha (born after 2010). 

The latest Australian Bureau of Statistics population estimates also show the town's population increased by half a per cent in 2022. 

Belinda Anderson, a millennial who grew up in Sydney but moved to Birdsville and Mount Isa in Queensland before settling in Mount Gambier, said the town offered social experiences that were not available in cities.

She now runs the town's young professionals network, where membership has doubled in the past six months to about 1,100 people. 

"When we talk about life experiences, I think it comes a lot from trying something new," Ms Anderson said. 

"When you make the effort to try to hook into groups or activities and show an interest in trying to be a part of the broader community, you can have an amazing time." 

'Diversity' needed in housing 

Ms Ritchie said the influx of millennials meant the types of available housing in Mount Gambier would need to change to meet the demands of its new residents. 

"In order for our regional communities to continue to be attractive destinations for relocators we must see a greater diversity in housing, both in price and in type," she said. 

"These sorts of dwellings are not only popular for younger generations, they're also sought after by older people looking to downsize as well." 

Property market still growing 

Regional migration in Australia was down 70 per cent in the June quarter after the COVID-19 pandemic saw increased numbers of people moving away from the capital cities in recent years. 

But in regional SA, the property and rental markets are still rising, with median sale and weekly rental prices at record levels. 

Domain chief of research and economics Nicola Powell said rents for houses in regional SA had increased by 42 per cent since the start of the pandemic, to $390 per week. 

"Rents are certainly still increasing in regional SA. We've got annual increases in house rents up by about 11 per cent, and asking rents are at a record high.

"If you look at the regional markets and look at regional SA in isolation, and you look at the amount rents have grown since the beginning of the pandemic, and look at the Consumer Price Index and wages growth, there is certainly a mismatch."