Anthony Albaneses housing plan is falling apart as an immigration slowdown fails to solve the affordability crisis
Anthony Albaneses plan to build 1.
Anthony Albaneses plan to build 1.2million homes over five years is looking even shakier with building approval numbers now 30 per cent below whats needed.
Under Labors plan to solve the housing crisis, 20,000 new homes would need to be built a month until June 2029.
But in August, 13,991 new homes were approved, mainly by local councils, marking a massive 6.1 per cent plunge in just one month, new Australian Bureau of Statistics figures showed.
The apartment sector had an even bigger 16.5 per cent plunge in just one month, with the Prime Minister and Labor state premiers regarding high-density living as the key to boosting housing supply.
Institute of Public Affairs deputy executive director Daniel Wild said high immigration was creating social problems, as building activity failed to keep pace with rapid population growth.
The federal government has yet to meet a single National Housing Accord target, yet Australias out-of-control migration intake remains at record levels, he said.
It is a recipe for social and economic disaster.
Mr Albanese last month stood by his governments plans to boost social housing, with his government also vowing to slash immigration during this financial year.
I grew up in social housing – I know how important a roof over your head is and the opportunities it creates, he said.
The Prime Minister set an ambitious National Housing Accord target in August 2023 for 1.2million homes to be built over five years from July 2024.
But high immigration levels in 2022 and 2023 meant unaffordable markets like Sydney continued to post double-digit annual property price growth even as the Reserve Bank raised interest rates 13 times.
Anthony Albanese s plan to build 1.2million homes over five years is looking even shakier with building approval numbers 30 per cent below whats needed
Interstate migration, rather than overseas migration, is now the bigger driver of real estate values with Brisbane becoming Australias second most expensive house market after Sydney, ahead of Melbourne and Canberra.
But if fewer migrants flooded into Australia, this could also have flow-on effects for interstate migration, which has seen younger families flee Sydney in search of affordable housing.
AMP chief economist Shane Oliver said high immigration was the major cause of Australias housing affordability crisis.
The chronic housing shortage got the upper hand over high interest rates last year as immigration levels surged and this continues to be the main driver of rising property prices, he said.
Immigration levels remained high at the start of 2024 with 509,800 foreigners, on a net basis, arriving in the year to March but by July, the annual intake had moderated to 432,150.
Treasury is expecting that to slow to 260,000 in 2024-25, based on permanent and long-term arrivals and departures.
Government forecasts for a sharp fall in immigration and hence population growth point to some easing in underlying housing demand over the year ahead, Dr Oliver said.
CoreLogic research director Tim Lawless said an immigration slowdown was needed to ease the rental crisis, even if it meant more people living in share houses.
The slowdown in rental growth is likely to be a factor of both easing net overseas migration alongside rental affordability pressures forcing a restructuring of demand, he said.
Rental growth looks to have well and truly peaked as demand and supply rebalance.
On the demand side, slowing net overseas migration and a gradual trend towards larger households should help to ease demand-side pressure.
Under Labors plan to solve the housing crisis, 20,000 would need to be built a month (pictured is a Bondi rent queue in Sydney)
New South Wales
House prices in Sydney - Australias most expensive property market and the city housing the most migrants - grew by just 0.1 per cent in September.
This took the median house price to a still very unaffordable $1.474million but the annual increase of 4.9 per cent was still less than half the 10.7 per cent level of March, CoreLogic data released on Tuesday showed.
Queensland
South-east Queensland is still a tough place for renters and a hot property market, as a magnet for interstate migrants.
Brisbanes house prices grew by 13.5 per cent over the year to $973,534, which saw it overtake both Melbourne and Canberra to become Australias second most expensive house market.
The more affordable suburbs are getting the biggest price increases with home values in the Springwood-Kingston area of Logan climbing by 23.7 per cent over the year to $732,044.
But Townsville in north Queensland was one of Australias strongest performing regional markets, with prices up 25.8 per cent over the year to $512,452.
It did even better than the Gold Coast, where Southport home prices climbed by 16.5 per cent to $932,434.
House prices in Sydney - Australias most expensive property market and the city housing the most migrants - grew by just 0.1 per cent in September
Victoria
Melbourne, the city receiving the second highest intake of migrants, in fact saw its house prices fall by 1.3 per cent over the year to $925,762.
Investor interest was waned in Victoria since the state government this year imposed a $975 land tax.
Institute of Public Affairs deputy executive director Daniel Wild said high immigration was creating social problems, as building activity failed to keep pace with rapid population growth
But the other mainland, state capital cities are still seeing double-digit annual growth.
Western Australia
Perth continued to be Australias strongest performing big city housing market, with its median house price surging by 24 per cent over the year to $830,965.
The monthly growth pace of 1.6 per cent was 16 times stronger than Sydneys 0.1 per cent increase and double Brisbanes 0.8 per cent rise in September.
The Swan area, in Perths north east covering suburbs from Beechboro to Bullsbrook, had the strongest annual growth of 30.5 per cent, taking median home prices to $740,953.
South Australia
Adelaide was another strong capital city market with house prices rising by 14.4 per cent over the year to $856,856, even though South Australias population growth pace of 1.5 per cent is well below the national average of 2.3 per cent.
Tasmania
Hobart house prices have fallen by 1.6 per cent over the year to $692,504, with Tasmania also having a sluggish population growth pace of 0.4 per cent.
Australian Capital Territory
Canberra house prices grew by just 1.7 per cent to $966,684, with the national capital now in third place behind Sydney and Brisbane but ahead of Melbourne.
Northern Territory
Darwin, Australias most affordable capital city market, saw its mid-point house price grow by 3.4 per cent over the year to $592,507.
The Northern Territory capital is the only capital city market where an average, full-time worker earning $100,000 can buy a typical house with a 20 per cent mortgage deposit and not be in mortgage stress.
Housing supply
The gap between housing supply and demand will only narrow if immigration levels fall with building companies the most likely to collapse.
In the year to August, 161,233 new homes were approved, mainly by local councils.
With 2.5 people, on average, living in Australian homes, that meant would still be a 16,567 shortfall even once these houses and units were built, compared with the most recent annual immigration increase.
Federal Housing Minister Clare ONeil last month announced 13,700 new social and affordable homes would built under the first round of the Housing Australia Future Fund and National Housing Accord programs.
But Queensland, where housing affordability is worsening, is getting 1,315 new public housing units, compared with 4,135 in Victoria where house prices are falling.
