A report released earlier in the year by PropTrack found that in 2022 demand for rentals had already increased 31.1 per cent across Australia’s capital cities, with the supply of new properties available for rent unable to keep up.
According to the report, listings are down 26.3 per cent year on year, and in 2023 new listings are the lowest they’ve been in 20 years. The decline has been strongest in Sydney and Melbourne – precisely where most of these new migrants will be trying to settle.
Many Australians are currently facing homelessness because they cannot afford to pay skyrocketing rents.
We already have tent-cities being set up in Queensland, and mothers and their children are living out of cars.
Combined with skyrocketing rents, energy prices are also expected to double this year. Just how much more pressure can low-income Australians take?
Australia has not yet had the populist backlashes that have led to crises in other liberal democracies, and for that we are lucky. We have one of the most successful multicultural societies in the world and, for the most part, orderly immigration has been embraced by Australians.
But our good fortune may be starting to unravel. High immigration can be absorbed when the pie is growing, and opportunities for upward mobility are abundant. But the pie is no longer growing, and younger and lower-income people in particular, feel like they’ve been screwed out of a fair go.
Younger people are now blaming older generations for rising rents, while older people are informing the young that the reason they cannot buy houses is not due to record population growth and poor government planning, but avocado on toast.
The reality in Australia is that everyone is impacted by our broken housing market, and no generation is to blame. While they are easy to scapegoat, landlords are not necessarily raking it in.
Property rates and charges have increased 63.6 per cent over the past 10 years, and recent analyses have shown returns on investment properties are not out-performing returns on medium- to high-growth super funds despite the increased risk and stress.
Many landlords have realised property is not the promising investment they thought it was, and are now selling out.
At the same time, while young people may indulge in discretionary spending that may scandalise their boomer parents, it doesn’t make sense to view their spending through the lens of a 1980s or 1990s economy, either.
Over the past 10 years, according to the consumer price index, electricity prices have soared 100 per cent, medical and hospital services 78.8 per cent, gas and other household fuels 75.6 per cent, childcare 75 per cent, secondary education 66.8 per cent, water and sewage 66.8 per cent and primary education 55.8 per cent.
At the same time, the prices of electrical equipment, clothing, phones, games, shoes, personal care products and household appliances have all declined dramatically. Younger people are buying “nice things” because “nice things” are a lot cheaper than they once were.
So the intergenerational blame game needs to stop. We are all in this together, and we should all want to see our fellow Australians thrive.
We should also avoid blaming new migrants for wanting to come to Australia, as they too will become victims of a broken system once they arrive.
Many will be shocked to find Australia has one of the worst rental markets for tenants in the world. And many will have to move, abruptly, when their landlords terminate their leases because they cannot afford to pay their mortgages.
International students who are lured here by grasping universities will find that other students are packed like sardines into rooms with bunk beds and unsanitary conditions.
Students who are unable to find a bed will be relegated to “hot-bedding”, that is, sharing a bed with other students (who they are not romantically partnered with). Many migrants who come here with the hope of finding economic opportunity will end up being exploited by rapacious employers in hospitality and agriculture, paid well below the award wage, and working more hours than their visa permits.
The idea that very high temporary migration does not put downward pressure on wages is laughable when you realise some employers illegally force temporary migrants to work for free.
Our ongoing housing crisis is not a problem that will be fixed by finding an easy scapegoat. But our politicians do have to explain to us why their policies are working at cross-purposes.
They cannot pretend to care about workers when flooding the workforce with temporary migrants – who are known to be regularly exploited by employers.
They cannot pretend to care about reaching “net zero” when they are ramping up net migration to record levels – something that cannot occur without significant increases in carbon emissions.
And they cannot pretend to care about the most vulnerable members of our community while injecting more demand into a housing and rental market that is comprehensively broken.
Claire Lehmann is founding editor of online magazine Quillette.
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