Australia’s immigration surge has once again come under the spotlight amid growing concerns about housing affordability. As net migration reaches record highs in the post-pandemic period, the nation’s housing market pressures have become a central political issue. A recent ABC investigation found that while many economists agree population growth — particularly through migration — has contributed to rising house and rental prices, the root cause remains a lack of housing supply.
Despite a record 2.5 million migrants currently living in Australia, housing construction has failed to keep pace. For the first time since 2001, new home completions have lagged behind population growth, leading to mounting supply shortages. Experts say this imbalance has been a major driver of worsening housing affordability across the country.
Between 2006 and 2016, migration was found to have lifted annual housing price growth by only about 1.1%, yet its impact on rents was more pronounced. Reserve Bank Governor Michele Bullock noted that migration has intensified pressure in the rental market, especially in major cities and areas with high concentrations of international students. One think tank estimated that cutting migration over ten years could lower rents by just 2.5%, suggesting that population policies alone would offer limited relief.
Still, reducing migration could come at a significant economic cost. Government data shows that migrants make a strong fiscal contribution — paying more in taxes than they receive in welfare — and play a crucial role in filling labour shortages, including in the construction industry itself. This, in turn, helps expand housing supply over time.
Researchers conclude that Australia’s housing crisis cannot be solved by population control alone. The core challenges lie in construction inefficiencies, planning bottlenecks, and regulatory inertia. Without deeper structural reform to boost housing supply and streamline development, even a reduction in migration is unlikely to ease the nation’s rent and affordability woes in any meaningful way.