If you are able to reach the current pass mark for Skilled Independent migration, you can choose to live anywhere in Australia. If you are sponsored by a relative in Australia and can meet the pass mark for Skilled Sponsored migration, you can also choose to live anywhere in Australia (you don’t have to live with or near your relatives).
However, if you can’t reach either pass mark, you might be able to obtain state sponsored migration to Australia (sponsorship from a State government). To be considered for state sponsored migration you still must meet all of the Basic Requirements for skilled migration and reach a particular points total, currently 70 points pool mark for a permanent State/Territory Nominated Independent (STNI) visa or at least 110 points for the temporary Skilled Independent Regional (SIR) visa.
In addition, your occupation must be in ‘short supply’ in a particular State and you must commit to living and settling in that State for a specified period of time. For the SIR visa, there are restrictions on which areas of Australia you can settle.
You can apply for State government sponsorship either before or after you lodge a migration visa application with the Dept of Immigration and Multicultural and Indigenous Affairs. If you are lucky enough to obtain sponsorship your migration visa application will be processed in Adelaide as a priority (currently 4-6 months processing time).
At the moment, there are realistically only three States who offer sponsorship for STNI or SIR; they are Victoria, South Australia and Western Australia. Other States are in the process of setting up sponsorship procedures for SIR visas but do not offer sponsorship for STNI visas.