‘2000 a day’: Barefoot Investor Scott Pape hits out at ‘broken’ Australia
Barefoot Investor Scott Pape has weighed in on one of the most controversial topics in the country, saying it’s time to ask a hard question.
Barefoot Investor Scott Pape has weighed in on Australia’s immigration debate, questioning the country’s record migrant intake levels despite a rental crisis gripping the nation.
Pape, the finance expert behind bestsellers The Barefoot Investor: The Only Money Guide You’ll Ever Need, The Barefoot Investor for Families and Barefoot Kids: Your Epic Money Adventure, said while he is “not anti-immigration or xenophobic”, he didn’t agree with the country’s current “unrelenting, unconstrained goal of ‘economic growth’”.
Writing in his News Corp Australia column on Sunday, Pape questioned why — despite Australia’s rental market being “fundamentally broken” and affordability being “officially the worst on record” — the country was bringing in 2000 new migrants a day.
“Yes, there’s more to solving the property crisis than immigration,” he explained.
“There’s the tax breaks that favour investors, a genuine lack of supply, and more social housing that needs to be built.
“Yet the fact remains that, as it stands, overseas arrivals are outpacing the construction of new homes at a rate of almost four to one.
“Why are we currently bringing in 2000 new migrants a day – 659,800 in the last year – when the rental market is in crisis?”
Pape used a metaphor he shared with his young son about squeezing too many sheep into a paddock on their family farm.
“Our politicians like to crow about how we’re the ‘lucky country’ that hasn’t had a recession for a record-breaking 34 years,” he said.
“Yet we’ve largely achieved it by bringing more people into our paddock.”
Pape’s comments come just days after the Australian Bureau of Statistics (ABS) released figures showing net overseas migration in the September quarter was 21,800 higher than the previous quarter at 145,200 arrivals, the second highest quarterly increase in history.
Net overseas migration increased by 60.3 per cent on the previous year and drove 83 per cent of Australia’s annual population growth.
Including natural increase, Australia’s population grew by 2.5 per cent to 26.8 million people in the year.
“It’s record highs, 550,000 net intake over the 12 months to September last year,” Daniel Wild, executive director of the Institute of Public Affairs (IPA) told Sky News on Thursday.
“That is 60 per cent higher than the previous record over a 12-month period to September. What is clear is that the government is not in control of its migration program and this is causing immense economic and humanitarian damage to our nation. We’ve had four consecutive quarters of negative per capita economic growth.”
Mr Wild said the last time that happened was in the early 1980s in the middle of a global economic recession.
“Migration makes the economic pie bigger but the slice of that everybody in this country is getting is now smaller,” he said.
“What is clear is that the government’s policy is fundamentally out of step with the expectations of the community.”
Advocacy group Sustainable Population Australia (SPA) said Australia’s population growth of 2.5 per cent was “equivalent to that of Nigeria, Senegal and Somalia”.
“Growth of just under two-thirds of a million people in one year on this largely arid continent with a variable climate and poor soils is unconscionable,” SPA national president Jenny Goldie said in a statement.
“It is unsustainable in economic, social and environmental terms. Indeed, it is nothing short of criminal. It is the main cause of the all-time rental crisis and the cruel increase in homelessness, but Mr Albanese simply doesn’t care. He knows he has no voter consent for what he’s doing.”
Leith van Onselen, co-founder of MacroBusiness and chief economist at MB Fund and MB Super, said the latest figures from the ABS was just another sign that “population numbers are out of control and it’s coming at the same time as housing construction is collapsing.”
ABS data earlier this month showed the country added a net 166,000 homes last calendar year, at the same time as the population grew by 680,000.
“So we only added one home per 4.5 new residents,” he told 2GB radio.
“That there, ladies and gentlemen, is why we’ve got a rental crisis.”
It comes after former NSW Premier Bob Carr slammed Australia for running the highest rate of immigration in the world, saying “we don’t need it”.
“I’ve been trying to get Australians to understand that we do not need to have the highest rate of immigration, in proportion to our population, in the world,” Mr Carr told Sky News host Erin Molan.
“There’s no other country doing this. We’ve got third-world rates of immigration and we don’t need it. I just wonder why this is the only economic model we’ve got – to force feed population growth, to run the highest imaginable immigration intake, and to condemn our big cities to a relentless chase to keep up in terms of infrastructure. We don’t have to do it to guarantee Australia’s prosperity. In fact, it’s a pretty lazy way of running an economy.”
Currently, the national rental vacancy rate – that is, the proportion of all leased dwellings available on the market – is about 1 per cent.
Migration provides big benefits to Australia by helping to grow the economy, but PropTrack executive director of research Cameron Kusher said it also creates huge demand for housing and infrastructure.
“It’s no wonder there is seemingly a growing resentment towards migration,” he told news.com.au.
“When you consider those that are already here in Australia are paying high prices for shelter or struggling to even find shelter for themselves.
“Given this, a growing number of people feel as if their quality of life is deteriorating and that the more people that come to the country, the more it will deteriorate because this deficit of housing and infrastructure is not being addressed.
“If governments shy away from reforms that allow more housing supply, improve productivity and just generally improve people’s quality of life, I anticipate there will be an increase in protest votes and votes shifting from major political parties to smaller parties.”
– with Frank Chung and Shannon Molloy
New hope for homeowners ahead of rates call
Inflation has hit 3.8 per cent for the June quarter, but some economists say that figure has given the Reserve Bank room to keep rates on hold.
Inflation figures to give big hint on rates
The June quarter inflation data will be released on Wednesday morning, giving pundits a clearer idea of whether the RBA will seek to hike rates next week.
Grim warning after latest housing figures
New data shows building approvals have stuck at near decade lows despite a modest uptick in the first half of the year, with NSW dragging down other states.