As migrants flood Auckland and Sydney, locals are forced out

By Leith van Onselen

Auckland and Sydney have much in common. Both are the largest cities in their respective nations. Both are harbour cities. Both have ridiculously expensive housing, with median dwelling values that hover near the $1 million mark. And both are the international gateways to New Zealand and Australia, and thereby attract the biggest share of each nation’s migrants.

Another factor both cities have in common is that local residents are being forced out en masse by the perpetual migrant flood, as well as the chronic housing and infrastructure pressures this creates.

Let’s look at Auckland first, where new research shows a net loss of Aucklanders to the rest of the country of 33,000 during the last Auckland housing boom (2014-17), more than offset by a net increase 141,000 migrants. From Interest.co.nz:

Economist Benjie Patterson has crunched information from the Integrated Data Infrastructure (IDI) for the period 2014-17…

He’s found that in the 2014-17 period the exodus from Auckland was increasing. In 2014 the net loss was 2,727, increasing to 6,924 in 2015, 10,332 in 2016 and 12,942 in 2017.

The figures coincide with the period in which Auckland house prices were rocketing and becoming increasingly unaffordable…

“Net regional migration out of Auckland is characterised by high net outflows of people in their late twenties and through their thirties with children”…

Now Sydney, where the latest capital city population figures from The ABS revealed that Sydney’s population ballooned by 93,411 people in 2017-18, driven by 77,091 net overseas migrants, who accounted for 83% of Sydney’s growth. At the same time, 27,264 locals departed the city:

As we know, the cost of a dwelling in Sydney skyrocketed to insane levels:

Which drove the home ownership rate for those aged under-40 through the floor:

With the proportion of households thrown onto the rental market ballooning:

And more than half of lower income households deemed to be in ‘rental stress’:

So basically, incumbent young Aucklanders and Sydneysiders have been forced to move from where they grew up just so they can make way for the perpetual torrent of migrants hitting each city every year via both governments’ mass immigration policies.

Cutting immigration back to sensible levels would improve income/wealth inequality and home ownership as there would be less upward pressure on house prices, as well as less economic rents flowing to the owners of capital (who benefit the most from mass immigration while ordinary residents bear the costs).

Wage growth would also improve, other things equal, as there would be less competition for jobs and workers’ bargaining power is increased, which would also help to reduce inequality.

There would also be less youth unemployment, as employers are incentivised to hire and train young workers and graduates rather than taking the easy route of importing a migrant.

Lower population growth would also lift productivity and income by decongesting both cities and, over the long run, would share both nation’s fixed national endowment of resources among fewer people, also ensuring higher income per capita.

Reducing immigration back towards the historical levels is a no-brainer for anybody concerned about inequality and living standards.

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Comments

  1. Listening to the Luke Ford livestream on YT and they’re talking about the F.I.R.E economy (Finance, Insurance, Real Estate) and how it is the largest proportion of the US GDP with activity in relation to Real Estate making up a larger proportion than manufacturing…..the same thing is happening here.

    • DominicMEMBER

      I sense a great opportunity here: sell your grossly over-valued property in Sydney to some unsuspecting foreigner and move away to somewhere more sane for a few years. Keep the cash handy (in something likely to retain its value) then move back into town for way less than half the price once the apocalypse smokes all the dingbats who bought in at the highs. Quarter-priced homes in great areas and barely half the population left. What’s not to love?

      Sydney and Melbourne are cooked. Only a large base of high earners can sustain prices in those cities and I don’t see what either of those cities has to offer that can sustain and grow high earning jobs. The FIRE industry is going to shrink massively in the coming years as the financialization of EVERYTHING comes to a clattering end.

    • @Dominic you’re assuming the state won’t implement negative interest rates, government handouts, QE etc. I can’t see the Australian Govt allow the property market to collapse or let alone correct….you’re going to have face this crisis head on.

      • DominicMEMBER

        Oh, I can pretty much give you a written guarantee that the State will attempt all manner of sh!te to keep things propped up, however, they won’t be able to do so forever. There are always costs associated with shenanigans like this and the damage in this case will be borne by the currency i.e. eventually it’ll be rendered worthless (unless they voluntarily cease its debasement). Irrespective of the choices that Govt makes the outcome will be the same either way — an economic depression. Once that happens, Govt loses all power to do anything and we will have a reset which will, among other things, see the Govt stripped down to a fraction of its original size. Frankly, when the economy is in the sh!tter and the welfare state has effectively imploded i.e. each man for himself, anyone with the means to go somewhere better will do so.

  2. “And both are the international gateways to New Zealand and Australia, and thereby attract the biggest share of each nation’s Australia’s migrants”

    Heaps and heaps and heaps of low rent foreign invaders immigrants are using NZ as a convenient back door to make their way here. The Trans Tasman agreement should restrict migrants from NZ to those born there, but it doesn’t.

    Meanwhile…Sydney dam levels continue to shrink rapidly…

    • Stewie GriffinMEMBER

      Just Nuke Sydney and Melbourne – existing Australians will be better for it

      • we need to let the American’s know vast deposits of oil lie underneath both cities………………

      • An interesting proposal. It wouldn’t result in too many actual Australians being harmed…

    • This blog ceased being an economics/finance blog a long time ago.

      Instead, it’s become a daily real-time historical account of the accelerating collapse of Australia.

      When the history books of the country formerly known as ‘Australia’ are written, I hope the authors will dial up the Macrobusiness archives as their source material.

      • If there aren’t a number of significant rainfall events in the catchment over the next couple of years, Sydney is gonna be fcuked.

        As that image shows, with population increases driving the usage, Sydney has nowhere near the reserves required to survive an extended dry spell. Like we’re in now.

        Massive population increases only work over the long term if the infrastructure to support the increases is put in place. As we all know, the Feds have been pumping the population Ponzi like mad, and enjoying the economic sugar hit but not supplying the funds to the states to allow them to develop the necessary infrastructure. The result has been overcrowded roads, crush-loaded public transport, crowded schools. All providing horrible consequences for quality of life.

        Unfortunately, the water supply infrastructure hasn’t kept up with population, and while the consequence of that stupidity is initially on quality of life, it eventually affects life itself.

  3. reusachtigeMEMBER

    I for one feel very privileged to live in a very popular city like Sydney rather than a tier two or three city like Melbourne or Brisbane.

  4. AtaraxianMEMBER

    Reducing immigration back towards the historical levels is a no-brainer for anybody concerned about inequality and living standards.

    ‘Anybody concerned about historically high immigration on inequality and living standards is a no-brained nobody’ – modern Australian politics.

    And there’s the problem…

    • And the spillover is moving to Brisbane. Brisbane’s growth has been insane for a city that doesn’t produce much.

  5. Australia is in crisis.
    March 2018 : 2.431 million TR / SCV
    Fact check / source.
    https://www.vsure.com.au/many-temporary-residents-working-australia/

    March 2019 : 2,561,000 TR/SCV – 130,000 net new.

    89% or 2.3 million Temporary Resident / SCV visa holders concentrated in Sydney & Melbourne (ABS)

    🔹Sydney pop 5.2 million.
    🔻1.3 million Temporary Residents.
    ◽️1 in 4 people.
    At 6 or more per dwelling, double the normal occupancy rate – they occupy over 210,000 ex Australian dwellings now converted to migrant slumshare.
    Where do people think they all live?
    Have you been out to the western suburbs lately?

    🔹Melbourne pop 5.0 million.
    🔻1.05 million Temporary Residents.
    ◽️1 in 5 people.
    The same… At 6 or more per dwelling- they occupy over 160,000 ex Australian dwellings now converted to migrant slumshare.

    And so we see the White flight.
    The Australians all ethnically cleansed & dumped out on the street, or pushed out to the rural backblocks.
    As their housing is bought out by the foreign criminal syndicates laundering in their dirty money – then the ex Australian housing is converted to migrant only cash in hand slum share.

    Whole suburbs – a vast swathe of both Sydney & Melbourne are now fetid migrant only slum enclaves.

    The main occupants? The TR / SCV.
    Non citizen third world unskilled migrants on TR / SCV pretext visas, only here to work & living illegally.

    We need a Royal Commission into our totally broken & corrupted Temporary Resident Visa system.

  6. Without migrants Australia is #ucked…they are more productive and keep the housing prices from crashing.

  7. Could you please elaborate as to how do you define an individual as local and/or migrant?

    Is someone from NSW considered a migrant in QLD?
    Is someone who has lived in Australia/NSW for 10years a local or must be born here or must have min. 2 generation or 3 generations here considered a local?

    • If you do not have AUS citizenship, you are a foreigner. Simple.

      The population of Sydney is not increasing because too many Queenslanders are moving to Sydney. As the graphs show, there is an exodus out of NSW – but 77,000 people move directly from overseas to NSW annually.

      Malcolm Roberts was born in India and is a senator again.

      Other immigrants from India, such as this taxi driver, are sick of mass immigraiton:

      14m55s

      https://youtu.be/niQMmARwHyo?t=895

  8. Who wants to start the Reduce Immigration Party?

    Let’s get some seats in the Senate and work some magic there. A straight forward party name will work wonders.

  9. kiwikarynMEMBER

    This is why the “housing supply shortage” that has oft been touted for Sydney and Auckland is a crock. Prime first and second home local buyers are leaving for other cities, and being replaced by lowly paid immigrants who do not have a house deposit, any credit history, or the ability to meet mortgage servicing requirements. MSM obstinately cling to the myth that all local workers and immigrants are equal, but in the eyes of the mortgage lenders, they are not.

    • DominicMEMBER

      That’s a blasphemous claim in Peachy-land. Supply and demand is where it’s at, bro 😉

  10. “So basically, incumbent young Aucklanders and Sydneysiders have been forced to move from where they grew up just so they can make way for the perpetual torrent of migrants hitting each city every year via both governments’ mass immigration policies.”

    This is a key point. Being forced to move away from social support networks does enormous social damage. People are easy isolated and can’t call on family and friends to help when needed. Then they carry on about suicide etc. How about policies that build and reinforce communities instead of ripping them apart? This is especially important for parents with young children. It’s such a shame. It really feels like we have lost control of our democracy to special interest groups who see us as nothing more than a bottom line.