Developer’s lobby demands “rapid return” of mass immigration

The Urban Taskforce represents “Australia’s most prominent property developers and equity financiers”. It has provided a submission to the House of Representatives Standing Committee on Tax and Revenue’s inquiry into Housing Affordability and Supply, which simultaneously complains about supply-side constraints while also demanding a “rapid return” to mass immigration.

Below are key extracts encapsulating the Urban Taskforce’s supply arguments:

Housing supply is critically linked to housing affordability. While this might seem like basic economics, that fact that many in the planning community do not accept this maxim is one of the reasons we have such as problem today.

The dogmatic denial from some planners that they have any part to play in causing the problem causes reform paralysis…

Urban Taskforce has been at the forefront of highlighting the failure of the NSW Planning System to ensure its most important task is delivered: to ensure that enough houses are built to meet demand. The Greater Sydney Commission has done the work and the results show that new housing supply has not met demand… the crisis has evolved over the last two decades and this resulted in a cumulative under-supply…

Urban Taskforce has consistently contended that we need greater supply, less red tape, greater flexibility, faster approvals and urgent reform of the NSW planning reform. The States need to address planning constraints on new housing supply or prices will continue to go up…

Next are the Urban Taskforce’s key statements regarding a “rapid return” to mass immigration:

The Commonwealth Budget position is predicated on an assumption that Net Overseas Migration will return, firstly to 160,000 p.a. then rise to 225,000 p.a. over the coming 4 years in the post /COVID recovery period. This is critical to the growth of the Australian economy…

Just under one third of all overseas migrants settle in NSW. The current housing affordability crisis, driven as it is (in part) by a lack of housing supply, poses a real threat to the Commonwealth’s budget position…

Prior to COVID-19, the cap on permanent migrants was reduced from 190,000 to only 160,000. In 2020, this number reduced to almost zero. Further, Australia has not been meeting its cap since 2016. This had a negative impact on economic growth in that period…

If it settles at a permanently lower rate of 100,000 (similar to the level in the late 1990s, before reforms were implemented to attract skilled workers and international students) the impact will be pronounced. The growth rate of GDP would be reduced 0.6%pts, to just 1.3% pa. This is equivalent to output being $460bn less in 2050, when compared to a path consistent with the Centre for Population’s latest projections…

We must change the planning system to build in flexibility to cater for a rapid return of migrants to our economy…

Urban Taskforce welcomes the Commonwealth’s moves to re-introduce both temporary and permanent migration as soon as possible. We further note the Commonwealth’s plans to increase the Net Overseas Migration intake to well above the pre-Covid intake…

Urban Taskforce recommends that the Committee note the need for a rapid return to anticipated levels of immigration as soon as it is safe to do so. Further, in light of the current shortage of housing supply across Australia, Urban Taskforce recommends that the Committee actively progress all available measures to promote housing supply.

The Urban Taskforce is obviously talking its own book. “The crisis has evolved over the last two decades” precisely because the federal government opened the immigration floodgates:

Australia’s net overseas migration (NOM) jumped from an average of 90,500 between 1991 and 2004 to an average of 219,000 between 2005 and 2019 – representing an annual average increase in immigration of 140%.

But what’s the point of running a high immigration policy to juice construction if the new buildings merely house new migrants? That’s tail-wagging-the-dog economics that creates many negative externalities for the incumbent population.

Mass immigration led development is the ultimate Ponzi scheme, with the property industry privatising the gains while the costs are socialised on the existing population via: 1) funding the increasing infrastructure needs (water, power, transport, recreation facilities etc); and 2) suffering the downsides of increasing congestion, being crammed into defective high-rise apartments, paying higher housing costs, and lower wages.

A Ponzi scheme is no way to apply government policy for the good of the people. The housing industry should meet the needs of Australians, not the other way round.

Given the government and housing industry continuously argue that Australia’s housing affordability woes are caused by a ‘lack of supply’, surely then the first best solution is not to return immigration back to its pre-COVID extreme level?

Consider NSW, which the Urban Taskforce has focused upon in its submission.

The NSW Productivity Commission (PC) released a White Paper in June explicitly stating that Sydney’s housing shortage was caused by an unexpected boom in Sydney’s population when the federal government threw open the immigration floodgates in 2005:

Much evidence suggests that our State, and Sydney in particular, has not delivered enough housing over many years.

Of many possible contributing factors, two stand out. First, population growth has exceeded expectations. Forecasts made in 2005 predicted that Sydney’s population would reach 5.2 million by 2031. More recent projections are for a population of around 6.2 million by this time (NSW Department of Planning, Industry and Environment, 2019).

Second, housing supply policy has not achieved the desired results… Since 2006, NSW housing supply has not kept pace with demand or State targets. That has created an accumulated underlying shortage of dwellings.

Shortly afterwards, the NSW Budget revealed that the state’s housing shortage had all but evaporated thanks to the collapse in immigration:

Residential construction is expected to remain strong in the very near term, fuelled by higher house prices, ongoing policy support and low interest rates…

Building approvals are now running well ahead of the change in population, which is depressed due to the lack of inward migration. This suggests a potential oversupply in the near-term relative to the underlying demand for housing (Chart 2.13).

However, rebooting pre-COVID mass immigration would create renewed ‘housing shortages’, according to NSW Intergenerational Report. Specifically, the NSW IGR states that “net overseas migration is expected to return to positive levels in 2023, before returning to pre-COVID-19 levels towards the end of this decade”. Accordingly, “net migration is projected to contribute 2.0 million people to the NSW population” over the projection period to 2061, which “will need 1.7 million additional homes for a growing population, equivalent to one new home for every two existing homes”.

Thus, Sydney’s housing shortage could be permanently solved with the stroke of a pen by the federal government. All it needs to do is reduce immigration back to historical pre-2005 levels. This would also negate the need to bulldoze Sydney’s suburbs into high density.

Sydney population projections

Sadly, in the property Narco state of Australia, lobbyists like the Urban Taskforce pull the strings. Nothing boosts their profits like flooding the place with millions more migrants.

Unconventional Economist

Comments

    • FDA Banned Boosters

      Serves them right. Couldn’t socially distance and be sensible.

      Instead of rolling up their sleeves they will be rolling down their pants in two weeks and bending over.

      They will comply because they all need jobs to pay bills lol.

    • Still no mention of rubber bullets and tear gas from the police from the ABC. Just propaganda on the 7.30 report. It is on the video.

          • Which video? the one curated by the ABC that doesn’t mention the Teargas and rubber bullets? or is there another one that carefully curates out the violent actions of the other side.

            The video I saw had beer cans being thrown by protestors, even saw a 4×2 piece of being wielded.

            Its interesting how people think the “State” are manipulating things to make it look just but cant see that the counter arguments are just as likely to be manipulated.

            Fact. It was an illegal protest and they were told to break it off and go home. They didnt listen, how were the police expected to enforce the law? More asking? Maybe a pretty please?

          • The video is he one that’s on the post.
            This is the performance on Saturday
            https://www.rebelnews.com/police_pepper_spray_arrest_journalists_at_latest_melbourne_protest
            If you looked at the live stream here
            https://www.youtube.com/watch?v=tUSyJRB1yiI
            you will see a crowd avoiding confrontation. You will see the police surrounding them and making retreat impossible. None of this is about health. The demonstration was not legal according to social distancing rules and not even Dan’s decree; it wasn’t even in the CBD. Spraying the journos and smashing the old lady was more illegal. The police have slipped the chain and are out of control. They are the attack dogs
            Guard your freedoms well lest they be whittled away

          • Thats not even the same protest, they were not surrounded until after they refused to stand down and go home, and just because you feel the protest is justified doesn’t make it so.

            Not about Health? How? Covid is real despite these protesters beliefs to the contrary, it does kill people and will inevitably infect almost everyone. If it spreads too quickly, The poorly funded health system will fail and lots of people will die of all sorts of illnesses that would not have killed them.

            Your personal freedoms are a privilege granted by the community, not an inalienable right. For the good of the community your asked to curb some of your freedoms but wont, so the end result is that society will enforce the restrictions. You push back the end result is conflict….

            You have the right to refuse getting vaccinated, but that choice doesn’t come without consequences. No Vaccine, No Work, its the same rules applied to many people already, Defence personnel have had this for 4 decades. You can feel your freedoms are under fire and your hard done by, but your part of the community so suck it up.
            You make a choice to not get vaccinated, you don’t get to work.
            You choose to protest, get asked to move on and return home.
            You don’t comply, expect to get arrested and fined.
            You try to resist expect to have force applied.
            Resist the enforcement as a group and expect an escalation.

            So far every video I have seen of every Covid related protest has gone the same way, told to stand down, things gets thrown, police crack down, it escalates… Up until now the police have handed out a few fines and a few arrests, but the protesters are not getting the message. So now they are taking action that they will fine lots more and arrest the ring leaders. If this requires them to encircle the protest then so be it, they brought it on yourselves.

          • Your personal freedoms are the result of the suffering of millions of people over hundreds of years. They are not a privilege, The government governs by consent. The shutdowns are voluntarily entered into for the greater good. No one voted for this. It was never an election issue, it is done by decree.
            You obviously haven’t looked at the live stream posted above. Do so and be informed.

            Dan shuts down your business you’ve been building for years, commercial landlord executes on guarantee you lose your house and livelihood at the same time, Dan votes himself another pay rise with the public servants, Melbourne has one of the longest strictest lockdowns in the world and there’s no end in sight. Look at the empty shops. Think of the poverty behind them. No one volunteered for this – unlike the army.

            There is no excuse for bullying the media in the hope of compliance – why else do it? Why smash the old lady and spray her face when she is on the ground. That is not lawful, humane or decent- it is criminal.

  1. COVID has highlighted the stark east-west divides of Sydney and Melbourne, pumped far too quickly to 5m apiece. In that sense alone, the LibLab plan to go to 8m apiece (and beyond) is madness. But, according to Rizvi, the LibLab ticket for annual 235,000 net migration 4eva is looking “decidedly doubtful” of achievement. We can only hope he’s right

  2. Leith, do you think you could page numbers when you cite these reports? A few times I have used you references in arguments are they are discounted/ disbelieved because they are not fully referenced.

      • Arthur Schopenhauer

        To get as many people as possible on board, make it as easy as possible. Remove as many barriers as possible. Clicking through to the relevant page reduces so much friction.

        It builds credibility, and will accelerate the dissemination of your views. (IMHO)

        From the readers perspective, your article will only be one thing of many in their day. Clicking through to the relevant reference will lead to more, “This Guy is really onto something…” moments.

        • Sure. But it will add work from my end, especially when I am getting quotes from literally dozens of pages. I already work 50 hour weeks as it is. Burnout is a real problem.

          Anybody that wants to check my sources can easily. Just click the link and search for the quote. Hardly difficult.

  3. I reckon Melbourne is going to revisit the terrible period of early 1990’s. People leaving in droves, over $100bn debt, still spending on infrastructure centered around channeling people into CBD, probably no longer required, public infrastructure must be racking up huge debts (rail, buses, council pool centres etc). Its going to be an expensive time to live here. No more IP’s here for me.

  4. The NOM is out of developers’ control as it is merely a barometer, not an achievable or exact target due to the diverse nature and dynamics of those swept up by an expanded definition in 2006, while permanent migration is capped.

    The main drivers, outside of Oz churn over (many more returned past 18 months) are NZ’ers and international students. The latter has been dominated by China and sub Continent with the former’s numbers in decline for several years and with the latter have many other choices with the same to offer as Australia in e.g. Canada, US, UK and EU.