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Australia’s Immigration Boom vs. Housing Shortage: Can the Market Keep Up?


Australia’s property market is under immense pressure as immigration levels surge while the construction of new homes lags behind. Over the past four years, nearly 1.2 million immigrants have arrived in the country, while fewer than 600,000 new homes have been built. This supply-demand imbalance has contributed to soaring housing prices, rental shortages, and affordability concerns across the country.

This article explores the real numbers behind immigration and housing construction, along with visa regulations that restrict foreign buyers to new builds.


Immigration vs. Housing Supply: The Real Numbers


Immigration to Australia (2021–2025)


  • 2021–22: The COVID-19 pandemic led to a sharp decline in migration, with border closures keeping numbers low. However, as restrictions eased, migration quickly surged.

  • 2022–23: Net overseas migration (NOM) reached 536,000, marking one of the largest influxes of immigrants in Australian history.

    • Source: Australian Bureau of Statistics (ABS)

  • 2023–24: Net overseas migration dropped slightly to 446,000, but it remained well above historical averages.

    • Source: ABS

  • 2024–25 (Forecast): Net overseas migration is expected to fall to 260,000, as the government looks to ease housing pressures.

    • Source: The Australian


Total Immigration (2021–2025):


1,242,000 new immigrants have entered Australia in just four years.

New Home Completions (2021–2025)


  • 2022–23: In the September quarter, 45,970 new dwellings were completed. This suggests an annual rate of around 184,000 homes.

    • Source: ABS

  • 2023–24: The September quarter of 2023 saw 44,884 new homes completed, slightly lower than the previous year.

    • Source: ABS

  • 2024–25 (Forecast): Despite a rise in building approvals (up 6.3% in January 2025), Australia is still projected to fall short of the housing needed to match population growth.

    • Source: ABS


Total New Homes Completed (2021–2025):


Less than 600,000 new homes have been built, meaning at least 600,000 more dwellings would be needed to keep pace with population growth.


Foreign Investment and Visa Restrictions on Property


Foreign nationals looking to purchase property in Australia must obtain approval from the Foreign Investment Review Board (FIRB). The rules are clear:


  • Foreign buyers must purchase new builds, rather than established properties, to boost housing supply rather than increase competition in the existing housing market.

  • This applies to visa holders, international investors, and non-residents.

For more details on FIRB property rules, visit the official website:🔗 Foreign Investment Review Board (FIRB)


The Impact on Housing Affordability

Rising House Prices & Rental Stress


  • With more people competing for fewer homes, house prices continue to rise.

  • The PropTrack Rental Affordability Index shows rental affordability in Australia is now at its worst level since 2008.

  • Vacancy rates remain at record lows in Sydney (1.3%), Melbourne (1.1%), and Brisbane (0.8%).


The 400,000-Home Deficit

  • The Urban Development Institute of Australia warns that Australia will face a 400,000-home deficit by 2029, if new builds fail to keep up with demand.

    • Source: Courier Mail


Conclusion: Can Australia Close the Housing Gap?


  • Immigration has added over 1.2 million people in just four years.

  • Fewer than 600,000 new homes have been built.

  • Government policies requiring foreign buyers to purchase new builds have not been enough to increase housing supply.

  • Without urgent construction efforts, housing affordability will continue to worsen.


What’s next?The federal government is under pressure to reform zoning laws, cut red tape, and incentivize home construction. If supply does not increase, rental prices will continue to skyrocket, leaving many Australians struggling to find housing.


Sources:

  1. Australian Bureau of Statistics (ABS) – Net Overseas Migration (NOM) Data (2022–2025)🔗 ABS Immigration Data

  2. ABS – New Home Construction Data (2022–2025)🔗 ABS Housing Completions

  3. Foreign Investment Review Board (FIRB) – Property Rules for Foreign Buyers🔗 FIRB Property Guidelines

  4. RealEstate.com.au – Rental Affordability Report (2025)🔗 REA Rental Affordability Report

  5. SQM Research – Vacancy Rates in Australia (2025)🔗 SQM Research Rental Data

  6. Courier Mail – 400,000 Home Deficit Prediction (2029)🔗 Courier Mail Housing Deficit Report

 
 
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