Excessive immigration over many years is one of the main causes of Australia's housing affordability issues, and the issue with immigration is that the government has little control over it.
Universities and colleges, who view newcomers as clients rather than migrants, have taken up the majority of Australia's migrant intake.
They recruit them through "education agents" in other nations, encouraging them with sales commissions.
Additionally, some agents mostly offer visas rather than schooling. They resemble lawful people smugglers in certain ways.
2001: An Odyssey of Housing
The Howard administration subtly made two changes to it on July 1, 2001, laying the groundwork for this.
The Minister of Immigration was Philip Ruddock.
By the way, that was nine months after the capital gains tax was lowered by fifty percent, which caused an instant increase in the demand for real estate by investors.
It took a few years for the changes pertaining to foreign students to take effect, but they did: Australia's total migrant intake increased to almost 300,000 annually between 2005 and 2008.
On July 1, 2001, two changes were made: first, entry from "non-gazetted" nations, such as China, India, and Pakistan, was made easier after previously being nearly impossible. This was a reiteration of the White Australia Policy, and second, there was a more open and transparent path to permanent residency for international students.
Australia "went through a permanent transformation."
According to Abul Rizvi's book Population Shock, an Immigration Department official at the time, the measures were intended to "delay the rate of population ageing and push back the day that deaths would start overtaking births in Australia."
However, he continues: "The media hardly noticed the changes since they were so minor." They were focused on more sexy, attention-grabbing subjects.
"However, Australia was irreversibly altered by the July 1, 2001, revisions to the immigration laws."
Two other sets of changes were implemented by subsequent Coalition governments: in 2012, the risk rating was moved from countries to providers, and in 2022, Alex Hawke, the immigration minister at the time, removed the application fee for visas and gave students the ability to work without restrictions (it had previously been set at 20 hours).
After twenty-three years, it is clear that Australia has undergone a permanent transformation.
Crisis in housing
In addition to having a thriving multicultural society, well-funded universities, and steady population growth, we currently face a severe housing issue and will never experience a recession.
According to the current Labor administration, institutions should not be determining Australia's population growth based on their drive for profit because they have become dependent on international students.
The national interest should guide the government's management of it, particularly during a housing scarcity.
However, it is not as simple as it seems to make it happen. For starters, education currently employs a big number of people and is our major non-mineral export.
Universities also desperately need the money if government support is cut off; without international students, research would stall and the country's scientific endeavors would suffer.
Additionally, international students do not raise the cost of family homes or reside in suburban three-bedroom homes.
By assigning a specific number to each institution, which is based in part on the accommodations each offers, the government now seeks to limit the number of international students admitted.
Universities face challenges
Universities are fiercely protesting, claiming that 46,000 jobs are at stake and requesting that the plan include at least 39 public universities in the country. Even business associations have cautioned that it might trigger a recession.
Additionally, they have already begun distributing their offers for the upcoming year, and if they have to start pulling them, they risk pandemonium and harm to their brand.
Finding a fair number for each of Australia's around 1400 tertiary education providers is a bureaucratic nightmare.
It is extremely challenging to understand migration data because so few people are aware of what is happening.
A statistical problem
The ABS informed us last week that there were 469,140 net permanent and long-term (NPLT) entries into Australia in 2023–24, which is 12 months until the end of June. This figure is calculated by subtracting 641,000 permanent departures from 1.1 million arrivals.
We do not know how many students were among the NPLT arrivals or departures, but long term is defined as greater than 12 months, therefore it includes students.
We are aware that in 2023–2024, 375,000 temporary visas were granted to international students, and an additional 110,000 were granted to graduates, the majority of whom were from prior years. Additionally, 100,000 temporary skilled visas (formerly 457 visas) and 235,000 working holiday visas were awarded.
Thus, 820,000 temporary visas were issued in total last year. The ABS reported 1.1 million permanent and long-term arrivals last week, which almost equates to the 210,000 permanent migration permits issued in that year, which were divided among skilled, family, and humanitarian entries (some immigrants would have received their visas in the previous financial year).
By the way, permanent migration is capped, but the intake of temporary migrants is uncapped and solely driven by demand.
Dutton's reality check
Although he has not stated it, Peter Dutton's proposal to reduce migration to 140,000 annually only applies to permanent migration, which is now at 210,000. It is likely that he plans to leave working vacationers and students uncapped.
There must be a cap on international students because the government's goal of 235,000 net overseas migration year, including both temporary and permanent, is actually exactly half of the 469,140 net arrivals in 2023–2024.
Each institution can raise its cap by adding more beds because that goal is somewhat dependent on the ability of the country's construction sector to provide housing.
About 100,000 roofs would be needed to shelter 235,000 migrants, with 2.4 persons each house. Divide that by 2.4 as well. The total number of homes required for that rate of population growth would be almost 130,000. The natural increase is roughly 70,000, which is the number of people turning 25 less the number of deaths this year.
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