The biggest issue I think with relying on this policy is historically it isn’t effective:
The main problem with skilled immigration is there has to actually be job demand for skilled migrants in regional areas for them to actually move there.
So creating a que jumping regional preference system while good, is only to extent that demand for those immigrants in those regions exists.
I don’t think it will have much impact. Maybe more effective if the overall intake is reduced, and competition for the limited immigration quota also entices people to also take the regional restrictions to que jump.
There is also the Grattan Institute argument that decentralisation is bad because businesses deliberately move to city where there is higher productivity, access to labour, customers etc. Although arguably those benefits are offset by higher land costs.
It’s also ironic Grattan takes this line when they also argue that agglomeration economics of transport don’t exist.
That said, the priority in incentivising relocation is better transport links to regional hubs. People will move into a place (I.e regional town) if they can still access the city within a reasonable commute. If you provide those transport nodes you effectively turn regional land into suburb land, which will be reflected in the increase in land value. That ties into a whole other land value capture point…