A political earthquake in Canada later this year could see Australia abandon its reliance on the high-profile immigration policy that is fueling the housing crisis.
Like Australia, Canada is also one of the world’s highest population growth nations, importing record numbers of skilled migrants to fill labor shortages.
Now it is almost as expensive to buy a home in Canada’s Vancouver as it is in Sydney.
Sydney is the second most unaffordable market in the world when the average house price is compared to middle class household incomes.
But Vancouver is in third place, on the US think tank Demographia’s 2022 list of the world’s most unaffordable cities, with Hong Kong considered the worst.
In Australia, the centre-right Liberal Party led by Peter Dutton is struggling to attract support from younger voters, but in Canada the opposite is happening.
Conservative Party opposition leader Pierre Poilievre is beating photogenic left-leaning Liberal Prime Minister Justin Trudeau to win over voters under 30.
A political earthquake in Canada later this year could potentially see Australia revisit its reliance on high immigration amid a housing affordability crisis (pictured is Sydney’s Wynyard train station)
The 44-year-old alternative prime minister has done this by calling for immigration to be cut so that population growth can match the supply of new housing.
“We need to make a connection between the number of homes built and the number of people we invite as new Canadians,” Mr. Poilievre told a media conference in Winnipeg earlier this year.
Sir. Poilievre also vowed that a Conservative government led by him would “return to an approach to immigration that invites a range of people that we can house, employ and care for in our health system”.
His approach appears to be working, with a Financial Times analysis of polling data from YouGov and Abacus Data showing Canada’s Conservative Party winning 40 percent of under-30s.
It’s a big turnaround from a 50-point deficit in 2021 for the party that has been out of power since 2015.
In Australia, younger voters are abandoning the Liberal Party with the conservative Center for Independent Studies reporting that only 26 percent of Gen Z voters, born from 1997 to 2004, cast first preference votes for the Coalition in 2022.
This was significantly lower than Millennials – born between 1981 and 1996 – who gave 35 per cent support to the Coalition in the early 2000s.
That figure had dropped to just 25 percent support by 2022.
The Center for Independent Studies suggested the Liberal Party in Australia would struggle to attract Millennials and Gen Z votes if they were unable to buy a house.
“In the absence of a concerted effort by coalition parties, it would be unwise to assume that younger generations of voters will move to the center-right as they age, as Boomers and Gen X did,” it said.
‘Millennials and Gen Z will only move to the right if centre-right political parties give them a reason to do so.
Conservative Party opposition leader Pierre Poilievre beats photogenic left-leaning Liberal Prime Minister Justin Trudeau when it comes to winning support from younger voters under 30
Australia is even more expensive than Canada with Sydney now considered the world’s second most unaffordable market ahead of Vancouver (pictured) when the median house price was compared to the median household income
“If the coalition parties are not perceived as offering solutions to the social and economic problems that matter to Millennials and Gen Z, there is no incentive for these generations to vote for them.
“The currently available evidence suggests that housing affordability and climate change are policy issues of particular importance to younger voters.”
Australia’s average house price was $933,800 in December, new official data released on Tuesday showed.
A borrower buying this property would need to earn $143,662 to get a loan, which rules out most single borrowers unless they bought with a friend or found a partner.
This is also well below the $639,375 home price that an average income earner can afford by borrowing at the maximum capacity.
That’s because the average full-time worker earning $98,518 with a 20 percent mortgage deposit can only borrow up to $511,500 – or up to 5.2 times pre-tax salary.
Sydney’s median house price of $1.396 million is also so expensive that someone would need to earn $215,000 and be in the top two per cent of income earners to buy alone.
Australia’s population growth of 2.4 per cent in 2022-23 was among the highest in the developed world, with Canada among the few with an even higher growth rate of 2.9 per cent.
Australia’s net immigration level of 518,000 was a record for a nation of 26 million people, while Canada imported a record 1,131,181 migrants into a nation of 41 million.
“International migration accounted for 98 per cent of Canada’s growth in 2022-2023,” Statistics Canada said.
“These high levels are related to the Canadian government’s efforts to ease labor shortages in key sectors of the economy.”
In Australia, the centre-right Liberal Party led by Peter Dutton is struggling to attract support from younger voters, but in Canada the opposite is happening (pictured are teenagers at Schoolies on the Gold Coast)
Sir. Poilievre’s pledge to cut immigration to match the supply of new homes has made his Conservative party favorite to win the October election, with the Tories on 41 per cent in the latest Leger tracking poll, compared to 25 per cent for the Liberals party. and 18 percent for the New Democratic Party.
In Australia, the latest Newspoll has Labor leading the coalition 52-48 per cent, after preferences from the Greens, which attract younger voters.
The opposition’s new shadow Home Ownership Minister Andrew Bragg did not mention high immigration in a Tuesday media release, campaigning instead to allow young people to withdraw their pension to buy a home.
The Coalition increased immigration under former prime minister John Howard, who presided over net levels that doubled from 100,000 in 1999 to more than 200,000 when he left office in 2007 after losing to Labour’s Kevin Rudd.
The Howard government also introduced a 50 per cent capital gains tax rebate in 1999, which meant that investor landlords only had to declare half of the gain on their tax return for that financial year.
One of his Liberal successors, Scott Morrison, was re-elected in 2019 and opposed then-Labour opposition leader Bill Shorten’s plan to halve the capital gains tax credit to 25 per cent and scrap negative gearing tax breaks for future purchases.