Finance guru Alan Kohler has said excess immigration is to blame for Australia’s housing crisis and is being fuelled by an influx of international university students.
ABC financial expert Kohler said it is not the permanent migration of workers that is primarily responsible for the growing demand for – and prices of – housing, but the growing number of foreign university students.
“Most immigration to Australia has been outsourced to universities and colleges, which view newcomers as customers rather than immigrants,” he wrote in an article for The New Daily.
‘They (universities) use ‘educational agents’ in other countries to recruit them, paying them sales commissions to incentivise them.’
Kohler considered the agents to be “a bit like legal human traffickers”: eager to get their cut but with no interest in the negative consequences.
Kohler said it was immigration policy changes in 2001 under the Howard government that “changed Australia forever”.
The changes have made it much easier for students from countries like India, China and Pakistan to enter and obtain permanent residency, compared with before, when it was “almost impossible,” Kohler said.
Kohler said the changes had seen migrant arrivals to Australia, including students, triple to 300,000 a year between 2005 and 2008.
Finance guru Alan Kohler has said that excessive immigration is to blame for Australia’s housing crisis, which is only being fuelled by an influx of international university students.
The Albanian government is planning to limit the number of international students accepted into universities.
The proposal faces widespread opposition from higher education providers, who are increasingly relying on upfront fees paid by overseas students rather than local students paying HECS.
It is understood the cap on room numbers could be raised if tertiary institutions funded student accommodation, thereby easing fierce competition for properties in the wider rental market, with Australia’s major cities having an ultra-tight vacancy rate of 1.3 per cent.
Any reduction in international student numbers would significantly reduce universities’ revenue streams, which would have a knock-on effect on the funds available for research projects.
“The current Labor government’s view is that universities have become addicted to overseas students and should not be deciding Australia’s population growth based on their desire for revenue,” Kohler said.
‘Universities also really need the money in the absence of government funding: without foreign students, research would dry up and national scientific effort would suffer.’
The imbalances created by population growth are not only felt in the rental market and housing prices, but also in the shortage of labour, especially in the construction sector.
This has caused the prices demanded by traders to skyrocket, which in turn has led to the collapse of a record number of construction companies and even further shortages in housing supply.
The Albanian government’s goal of building 1.2 million new homes by 2029 was predicted to fail almost from the moment it was announced, and is already behind schedule.
The target calls for building 240,000 homes each year, but that figure currently stands at just 150,000.
The government also hopes to reduce net outbound migration to 260,000 this financial year, after reaching 547,300 in 2023.
“Reducing Australia’s population growth to a level that approaches the construction industry’s actual capacity to build homes for all of them – rather than what the government would like it to be – is not going to be easy,” Kohler said.
An Australian earning an average full-time salary of $100,017 could only buy a $650,110 house with a 20 per cent deposit of $130,022, and banks can only lend someone 5.2 times their pre-tax salary.
This person would be in mortgage hardship if they bought a typical unit in Melbourne or Brisbane and paid $3,353 a month in mortgage repayments, or more than a third of their salary.
Someone renting in Sydney, where the average weekly rent for a home is $694, would have to pay almost $3,100 a month to a landlord.
Mid-priced homes in Australia’s major capital cities are out of reach of the average self-employed Australian worker, meaning they are limited to units or a house with a small backyard in a far-flung outer suburb.
The government is now planning to limit the number of international students accepted into universities (file image from the University of New South Wales)