This article is from the Australian Property Journal archive
THE Albanese government’s move to cap international student visas and help relieve demand pressures on the heated housing market would only save the average metropolitan renter less than 1% in rent, a new report shows.
The Student Accommodation Council’s report, Beyond the Visa Cap: Why Restricting International Students Won’t Solve Australia’s Housing Crisis, also shows the country’s 725,000 international students make up 5.4% of the rental market – and that capping their numbers will only reduce this by 0.6% by 2026 and have little impact on rental availability.
International student enrolments will be capped at 270,000 in 2025, the Albanese government announced in August, bringing the number of new international student commencements back to pre-pandemic levels. That followed a commitment to work with the higher education sector to develop regulations that would require universities to increase their supply of student accommodation.
Australia’s private rental market has been crushed by demand amid a severe lack of supply, and while September may have marked the early stages of a much anticipated change in conditions, vacancies are still at harsh lows and rents are still on the up – meaning renters are yet to catch a real break.
The new report estimates weekly mean metropolitan rents will only be marginally impacted as a result of the cap – by 0.8% on average, or just $5 a week.
“This reduction will not be felt in outer-suburban areas popular with families and retirees,” it said.
The report suggests the government’s caps on international students would result in $4.1 billion in lost GDP, and could see 22,000 jobs lost, representing 6% of the international student-supported workforce.
Victoria has the highest share of international students at 7% of renters, followed by NSW and Western Australia at 6%. Queensland and South Australia both sit at 5%, while the ACT, Tasmania and Northern Territory sit at 4%, 3% and 2%, respectively.
The report found the development of new purpose-built student accommodation (PBSA) had kept pace with the growth in international students – since 2015 the growth in international students has directly matched the growth in professionally managed student accommodation.
Around a quarter of the country’s international students (184,000) live in university accommodation and other arrangements, while 14% live in private PBSA – equating to just over 100,000 students. Some 440,000 seek housing in the general market.
8,000 rooms ready to be filled, more on the way
Student Accommodation Council executive director Torie Brown said for such minor housing gains, the government would be better looking at ways to increase the supply of accommodation rather than reducing demand.
“The student visa caps will have a very real economic impact, but have very little impact on rental availability,” Brown said.
“We would be better off focussing on increasing the supply of PBSA, which has already demonstrated an extraordinary ability to match the demand from international students,” Brown said.
“Student visa caps will have very little impact on the high rental costs or low availability of rental homes.
“Instead of stopping demand from migration we need to focus on delivering more homes across all quadrants of Australia’s housing market.
“Student housing can only be used by students. Increasing supply of this housing stock literally soaks up students from the general residential market.”
The Student Accommodation Council surveyed its members and found 8,000 available PBSA beds at the beginning of semester two this year.
“Let’s fill existing rooms first,” Brown said.
“Instead of unfairly blaming international students for the rental crisis, governments at all levels need to work together to expedite and accelerate student-only housing,” Brown said.
Singapore’s Centurion has just secured $228.5 million from multiple financial institutions to fund the development of a Macquarie Park purpose-built student accommodation project that will deliver 732 beds, while in a major vote of confidence in the sector, ASX-listed property heavyweight Dexus is teaming up with Marquette Properties to repurpose a B-grade office tower in Brisbane’s CBD into a $500 million PBSA with 1,200 beds.
Australia’s largest owner and operator of PBSA, Scape, in September opened the first of its $1 billion five-building precinct in Sydney, which will ultimately house more than 1,600 students.
On the Sunshine Coast, international architecture practice Plus Architecture has lodged plans for a new PBSA development in Petrie, north of Brisbane in Moreton Bay, near the University of the Sunshine Coast’s newest campus.
