Recall this week’s survey of 49 so-called “leading” economists, which pinned the blame for Australia’s housing crisis on supply-side barriers while ignoring the role of excessive levels of immigration:
Note from the above graphic that only 6% of surveyed economists picked “restrain immigration” as a solution to Australia’s housing mess, while 14% picked “fast-track immigration of home”builders”—effectively importing migrants to build homes for migrants.
Independent economist Tarric Brooker noted on Twitter (X) that “Australia completes more homes per capita than almost anywhere in the developed world. When the population is constantly grown at such a large rate, even a world beating level of construction still can’t keep up”:
I added that Australia also has more construction workers per capita than most other developed nations:
Indeed, according to the Australian Bureau of Statistics (ABS), Australia had 1,360,900 workers employed in the construction industry as at May 2024, up 34% from 1,015,200 a decade earlier:
New analysis from Bennett Jones also shows that Australia has spent more than most nations per capita on dwelling investment since 2007:
Source: Bennett Jones
The problem for Australia is that it has also experienced the strongest population growth over the past two decades among major developed nations:
Therefore, while we have built homes at a faster rate than most other nations, these have been insufficient to keep pace with the nation’s rapid population growth.
The reality is that Australia will struggle to build enough homes so long as it continues to grow its population aggressively via net overseas migration.
The latest Intergenerational Report projected that Australia’s population would swell to 40.5 million by 2062-63:
If this projection came to fruition, Australia’s population would expand by 13.5 million in only 39 years—equivalent to adding another Sydney, Melbourne, and Brisbane to Australia’s current population.
As I noted yesterday, this level of population expansion would conservatively require the construction of around 6 million homes, accounting for demolitions.
I say conservative because most of these homes would be apartments, which by nature cannot hold as many people per dwelling as detached houses.
An extra 13.5 million people would also require huge volumes of infrastructure investment, which would continue to compete against housing for labour and resources.
Australia’s economists should stop gaslighting and admit that lowering immigration to a level that is below the nation’s capacity to build housing and infrastructure is the key solution to the nation’s housing crisis.
The facts are staring them in the face.
