Key takeaways
Australia is growing fast — with net overseas migration at 446,000 in 2023–24, we’ve added nearly the population of Canberra in just one year.
But housing supply isn’t keeping up. Approvals and commencements are at their lowest levels in over a decade, far below what’s needed to accommodate this growth.
The result? Soaring rents, tight vacancy rates, and growing unaffordability — especially for first-home buyers and renters.
Federal government manages migration to boost GDP and fill job shortages.
State and local governments are responsible for housing delivery — but are often underfunded, slow, and constrained by politics or NIMBYism.
There’s no coordinated national strategy to ensure that migration targets match housing and infrastructure delivery.
It’s like planting seeds without watering them — planning systems don’t talk to migration planners.
Imagine inviting thousands of people to a party… but forgetting to organise enough food, chairs, or bathrooms.
That’s essentially what Australia is doing by ramping up migration while failing to plan for the housing and infrastructure to support it.
The conversation around our housing crisis is often framed around interest rates, investors, or planning delays.
But there’s a critical dimension we keep avoiding: Australia’s housing and migration policies are completely out of sync, and this is causing systemic damage.
Over the last few years, we’ve been experiencing the fastest population growth in modern history, yet we’re failing to build enough homes, in part because our policies are pulling in opposite directions.
The federal government is stepping on the accelerator with migration, while state and local governments are fumbling with the brakes on housing supply.
And the result is whiplash for everyone trying to navigate the property market with a critical shortage of homes, soaring rents, a generation locked out of ownership, and property investors left navigating chaos.
Let me be clear: migration isn’t really the problem. Poor planning is.
I believe we need to keep migration levels up to help maintain a large pool of employed tax-paying workers who grease the wheels of our economy and replace the retiring baby boomers and the many millennials taking time out of the workforce to have babies.
But unless we bring housing and migration policy into alignment, things are only going to get worse.
A migration boom – but where are the homes?
Net overseas migration was 446,000 in 2023-24.
Sure, that’s less than the staggering numbers of the year before, but it’s virtually the entire population of Canberra in just one year.
Now consider this: over the same period, dwellings approved and commenced fell below 2019-20 levels; approvals were 6.4% lower at 163,279 dwellings, and commencements were 8.2% lower at 158,690 dwellings.
These are the lowest totals seen since 2011-12, which were 149,889 and 145,350 dwellings respectively.
Here’s how that mismatch looks visually:
Two policies, two different planets
The heart of the issue is structural.
The federal government controls migration policy, while state and local governments oversee housing supply through planning laws, land release, and infrastructure development.
So, while Canberra opens the floodgates to boost GDP, fill job shortages, and drive long-term population growth, which I believe are all valid goals, they’re not the ones responsible for ensuring there are enough homes or schools or roads.
That responsibility falls to the states, which are often under-resourced, politically constrained, or flat-out behind on planning and delivery.
The problem is that these systems rarely talk to each other.
Migration targets are set without any coordinated plan for the homes, roads, schools, and services that new residents will need.
Worse still, housing policy is often reactive — councils block development to appease voters, planning systems are outdated, and infrastructure funding lags behind growth corridors.
It’s like having one hand planting seeds for a bumper crop and the other hand forgetting to water them.
Eventually, something breaks, and we’re all paying the price.
But renters are feeling it first, with vacancy rates in most capitals near record lows (under 1% in many areas), and rents have been rising at double-digit annual rates.
And of course, first homebuyers are being priced out — again.
Scapegoating instead of solutions
When housing affordability deteriorates, it’s tempting to blame the newcomers.
We’re already seeing this in the media — headlines suggesting migration is the root cause of the crisis.
But that narrative is both misleading and dangerous.
Migrants aren’t causing the housing shortage. Policy failures are.
In fact, migrants are more likely to live in shared housing or rent in high-density areas.
They’re also net contributors to the economy.
The real problem is that we’re growing the population without growing the infrastructure and housing to match.
Governments have failed to anticipate demand, streamline development approvals, invest in infrastructure, or incentivise the right types of housing in the right places.
Instead, we get knee-jerk policies – talk about rent freezes, investor scapegoating, and populist zoning restrictions that only make things worse.
But the shortfall in housing supply isn’t just a failure of policy alignment — there are also significant economic and financial headwinds making it extremely difficult to get new homes off the ground.
But it’s more than that
In recent years, the cost of construction has surged dramatically.
Building materials have seen double-digit price hikes due to global supply chain disruptions, labour shortages, and local regulatory bottlenecks.
Builders are paying more for tradies, insurances, and compliance, while delays from planning approvals and red tape only make projects riskier and more expensive.
And construction timeframes to build a new house have extended from 6.5 months pre-pandemic to over 10 months today, and of course, it can take years to build an apartment building.
At the same time, rising interest rates have blown out development finance costs, making it harder for developers to secure funding, especially for medium- and high-density projects where pre-sales are sluggish due to affordability constraints.
Many builders are simply walking away from proposed developments because the numbers don’t stack up — even if there’s strong demand, they can’t build at a loss.
As a result, we’re seeing a wave of project delays, cancellations, and builder insolvencies.
The pipeline of future housing stock is shrinking just when we need it to expand.
And ironically, this means even though we have a housing shortage, the market isn’t responding in the way basic supply-demand economics would suggest — because the fundamentals of feasibility have broken down.
What needs to happen
If we treated housing and migration as two halves of the same puzzle, here’s what would change:
- National housing targets linked to migration levels
If we’re going to bring in around 400,000 people a year, we need a plan to build around 160,000+ homes a year at a minimum.
Not just vague goals, but enforceable housing targets for each state and region, tied directly to migration intake numbers.
- Infrastructure planning that keeps pace
Housing policy isn’t just about roofs over heads — it’s about schools, roads, transport, and hospitals.
Migration policy should trigger infrastructure funding to ensure new communities are supported, not stressed.
- Fast-track planning and approvals
State governments must streamline approval processes, especially for higher-density housing in inner- and middle-ring suburbs where demand is highest.
If the people are coming, the homes need to be ready, and fast.
- Encouraging the right kind of housing
We don’t just need more homes — we need the right homes.
That means family-friendly apartments, townhouses near jobs and transport, and more rental stock.
Migration data should inform what gets built and where.
- A Federal-State Housing Accord that actually bites
We already have a National Housing Accord — but it’s toothless.
What we need is an agreement that holds each level of government accountable, backed by incentives and penalties.
This isn’t a nice-to-have; it’s critical to national prosperity.
The consequences of doing nothing
If we keep separating migration and housing policy, we’re not just setting up more housing pain — we’re risking:
- A permanent underclass of renters who’ll never be able to afford to buy.
- More social unrest as affordability erodes.
- Stagnation in productivity as workers can’t live near jobs.
- A continued concentration of growth in a few pressured cities, worsening infrastructure bottlenecks.
In other words, this is a national prosperity issue, not just a property market problem.
The bottom line
Australia’s housing crisis isn’t going to fix itself.
It’s a structural issue, made worse by misaligned policies and short-term thinking.
Australia’s migration program is essential. It brings in talent, rejuvenates our ageing population, and drives long-term economic growth.
But we must stop pretending we can grow the population without growing the places people live.
That approach is unsustainable, unfair, and ultimately self-defeating.
It’s time our policymakers realised that housing policy is migration policy, and treated it with the seriousness it deserves.
Otherwise, we’ll keep just growing our population without growing the places they can live — and we’ll all pay the price.
