You can always count on The SMH to blame a ‘lack of supply’ for Sydney’s rental crisis rather than blaming excessively rapid immigration-driven population growth:
“Despite strong population growth and persistent claims the city is in the grip of a housing supply crisis, Sydney added just 32,600 new dwellings in the year to December 31, well short of the 56,500 new dwellings built in 2018”, the article reads.
“Terry Rawnsley, an urban economist at KPMG who undertook the analysis, estimates more than 10,000 new residences in Sydney had been approved but had not been commenced at the end of September, exacerbating the city’s housing problems. About 85% of the stalled projects were for apartments or townhouses”.
The next chart plots NSW’s annual population change against dwelling completions:
As you can see, the state’s population growth stepped up in the mid-2000s, and it took years for construction rates to respond, and only temporarily.
Moreover, almost all of NSW’s population growth was driven by net overseas migration:
In the decade to June 2023, NSW added 935,315 people with 791,944 or 85% of this growth coming from net overseas migration:
Meanwhile, the bulk of the homes that were built during last decade’s boom in construction were high-rise apartments, many of which turned-out to be poorly built and riddled with defects:
According to the Strata Community Association NSW, four out of every ten newly constructed apartment complexes in NSW had significant flaws as of October 2021.
The investigation was launched in response to the discovery of serious structural flaws at Sydney’s Mascot Towers and Opal Tower, which resulted in the temporary evacuation of residents.
A legislative inquiry in NSW likewise discovered severe structural issues in freshly built apartment complexes.
The ABC last year reported that NSW Fair Trading had issued more than 30 work rectification orders across building sites, some for “potentially serious defects”.
Engineer Leith Dawes warned there was a game of “Russian roulette” when it came to buying an off-the-plan apartment.
In July 2023, WSWS reported that building defects will cost the owners of 276 apartments in Sydney’s Inner West Vicinity complex $50 million to repair.
Fifteen years of pre-pandemic hyper-immigration fueled the proliferation of defective apartments by requiring the annual construction of tens of thousands of homes.
This led to a compromise between quality and speed, resulting in a sharp decline in building standards.
History will repeat if policy makers get their wish and succeed in ramping-up construction to keep pace with the federal government’s extreme immigration program.
The optimal solution to Sydney’s (and Australia’s) housing shortage is to slash immigration to a level that is below the nation’s ability to construct high quality housing and infrastructure.
Because keeping the immigration throttle dialed up to the max and expecting to build thousands of low-quality apartments is a recipe for disaster.
Repeating the same failed policy over again and expecting a different result is the definition of insanity.
