Australians think higher immigration numbers will bring both positives and negatives for the housing market according to a new survey, although Sydney broker Nathaniel Truong says migration should be seen as a net benefit to Australia.
A Send Money Australia survey of 1,002 Australians found that 84% of respondents believe the Australian government’s decision to boost immigration from 160,000 to 195,000 in the 2022-23 financial year had at least one benefit for the country, with most naming benefits to the economy. Send Money is a comparison service for international money transfers.
More than 53% said they believed new immigrants filling skilled jobs would help solve Australia’s pressing labour shortage, while 48 per cent believed the program would bring an overall boost to the Australian economy through increased spending by immigrants.
Over a third (38%) of those surveyed said they believed various sectors across our economy would enjoy an injection of new ideas and innovation, while 36% thought that Australia’s cultural offerings and our society’s open-mindedness would improve as a result of the migrant boost.
However, 92% also believe the immigration program would bring at least one disadvantage as numbers rose, with 65% naming increased house prices and rents, 56% fearing overcrowding in cities and 45% worried about unemployment and job competition.
Housing market to face positives and negatives
Nathaniel Truong (pictured above), director of Loan Lounge, a brokerage based in Cabramatta, Sydney, said Australia has a history of migration, with 27.6% of the population born overseas according to the ABS. He said migration supported population growth, fuelled economic activity and tax revenues, and was generally positive for the community.
The higher migration intake could have both positives and negatives for housing, he said.
“The positives are increased demand from migrants wanting shelter for themselves and their families and once they are established, it’s a common dream to own an investment property,” Truong said. “This will help drive property prices, construction growth and demand for investment opportunities.”
“The negatives are pressure on housing prices and supply which leads to affordability issues, as it’s more difficult for buyers to get into the market. There is also pressure on rental yields leading to overcrowding and social issues such as homelessness.”
Truong said migration could ease labour shortages and support economic growth, boosting house prices, rents and demands for services in related industries, but on the flipside, there was always the potential for job competition, which could impact some people’s ability to repay their loans.
“I feel the increased competition will be positive for the property market and economy,” he said.
Better support the key to migration success
The Government’s migration program boost included 142,400 skilled visa placements designed to improve the productive capacity of the economy and fill skills shortages in the labour market. It also allocated up to 52,500 partner visas to reunite locals with family members from overseas.
Truong said mortgage brokers can work in their local communities to support these new migrants.
This could include providing mortgage broking services in their native language, and using videos, FAQs and seminars to help them understand how to get ready for a loan and who to work with.
Brokers could also build a team of professionals like accountants, solicitors, real estate agents and interpreters who can speak the language and assist migrants, Truong said.
“There are many ways to support migrants and I believe the key is to first value them as people and know that they are just looking to build a better future like all of us.”
Australia should continue to build its image globally as a destination country for migrants, he said.
This could include investing in better infrastructure to support settlement including healthcare, employment services and language services, effective and supportive integration programs, and a streamlined visa process making it quicker for them to become permanent residents or citizens.
Truong said more can also be done to mitigate house price rises, social tension, overcrowding and homelessness.
“Investors and even super funds are now considering social and community housing to help with affordability. I personally believe Australia should have a social conscience and balance profit with purpose to help alleviate society’s issues,” he said.
