The recovery in net overseas migration has and will continue to see a rapid recovery in the number of international students, skilled temporary visa holders and working-holiday makers. This is good news for employers seeking to fill roles across the board, for our tourism sector and our education sector.
Rebounding immigration levels, in lieu of a benign net natural growth, is helping to bolster our economic growth and skilled labour prospects into the future. This is being greatly assisted by the fact that international students are now staying longer after completion of their studies, helped by changes to visa conditions allowing graduates to stay and work longer in Australia.
Of course, the second order impact of immigration is an obvious one: if people are moving to Australia for jobs, and sensibly move where the jobs are – overwhelmingly within our capital cities – then we need to have sufficient housing in these locations to meet this demand.
This highlights the structural undersupply of housing stock in Australia, which has been an issue for many years. While this issue predates the pandemic, like many things it has been exacerbated by the pandemic as there has been a continuous decline in new private dwelling construction commencements during that period. Australian capital cities are low-density by international standards, we have not built enough houses, and the pipeline of new stock is moving in the wrong direction.
In April 2023, the total number of new dwellings approved declined by 8.1%, following a 1.0% decrease in March. The overall drop was primarily driven by a decrease in approvals for multi-dwellings, which plunged 16.5% to their lowest point since January 2012. This downward trend in construction activity, juxtaposed against the rising demand, presents a real challenge for housing availability.