Posh Teals gaslight on housing affordability

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Allegra Spender, the Teal federal member for Wentworth (which includes Sydney’s wealthier eastern suburbs), wrote two contradictory articles last year seeking a large increase in immigration while simultaneously wanting fewer carbon emissions (see here and here):

“In Wentworth, migration is a priority… That means providing more flexibility for businesses to bring in the people they need…”

“It means providing a permanent residence pathway for all those on Temporary Skills Shortage and Temporary Graduate visas”…

“We need to deliver a campaign and a policy-set that promotes Australia as the destination of choice for temporary migrants”.

“We can keep talented people here by implementing a minimum two-year term for all Temporary Graduate visas, with eligibility for renewal”.

“We can expand eligibility for repeat working holiday visas for those already contributing to our economy”.

“We can extend and broaden the relaxation of work restrictions on international students. And revert to four-year terms for all Temporary Skills Shortage visas”.

Alegra Spender’s mass immigration demands come amid her profile extolling the virtues of living in Sydney’s rich east, close to facilities and the beach:

“My Dad’s family has been in Wentworth for generations and growing up here was incredible – swimming in the ocean, doing the Bondi to Bronte walk, cycling around Centennial Park, going to the local restaurants and cafes – and all at the doorstep of the inner city”.

“That’s why I am raising my kids here and am so passionate that we give our kids the quality of life and opportunities that I had”.

Zali Steggal, a Teal member from Warringah (which includes Sydney’s rich northern beaches), likewise supported a large increase in immigration to combat labour shortages.

Spender and Steggal got their wish, as the Albanese Government used the phony Jobs & Skills Summit, fabricated “visa backlogs,” and the migration review to lift immigration to all-time highs, including by extending the number of years international students can live and work in Australia after graduation.

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The Albanese Government also signed migration pacts with India to ensure that immigration remains turbo-charged into the future.

As a result, net overseas migration and population growth reached an all-time high in 2022, driving the current rental crisis:

Australian population change
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Australia’s population was projected in the federal budget to expand by a record 2.18 million people over the five years to 2026-27, driven by record 1.5 million net overseas immigration.

Under those projections, Australia’s population would grow by the equivalent of a Perth in only five years, driven by an Adelaide’s worth of net overseas migration.

This is happening at the same time that housing construction is declining due to widespread builder insolvency and rising costs, thus ensuring that Australia’s housing shortage will worsen:

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Dwelling completions vs population change

Never fear. Alegra Spender declared a citizen’s assembly “bringing together 100 home owners, renters and mortgage holders to talk about how to solve Australia’s housing affordability crisis”:

Alegra Spender
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Spender also told Sky News on Thursday that current extreme levels of immigration are right and that Australia’s housing crisis has instead been caused by decades of political “inaction and failure”.

Spender also wants immigration policy to be considered separately from housing policy:

Peter Stefanovic: “What are your thoughts on [BCA chief] Jennifer Westacott’s report that comes out today basically saying don’t use migration as a scapegoat”?

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Alegra Spender: “I really support the BCA’s report on migration because migration is absolutely critical to the Australian economy. It’s critical to so many of our industries. You know, tourism, our universities”.

“But I think it’s absolutely right that frankly, decades of political sort of inaction and failure have led us to this housing crisis”.

“But frankly, they’re not the same thing. There’s migration, which is really good for our economy and frankly housing inaction, where the government needs to take urgent action across the country”.

Peter Stefanovic: “Are current migration levels too high?”

Alegra Spender: “No I don’t think so. I think that we have a strong, a good strong migration system. For me it’s really important for the community to get really good people into the country and also make sure that people have a pathway you know to permanency”.

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“I think you can play around the edges, but fundamentally I think our migration system is working”.

“But frankly housing and the problems with housing are really separate and frankly the government has to work really hard on this”.

Peter Stefanovic: “The government’s going to meet with the state leaders next week in National Cabinet to address housing. How confident are you that a deal can be done on boosting supply?”

Alegra Spender: “A couple of months ago we had the lowest housing approval for a number of years. And this is a time where increasing supplies absolutely critical”.

“So I’m calling on the government to use, you know, the money in the Federal Budget to really incentivise the states to make fundamental changes to planning and zoning laws”.

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“Because unless those laws get passed, unless we have fundamental change to planning and zoning, you know this is just going to be an aspiration”.

So basically, Algera Spender wants the federal government to ignore the demand-side of the housing market and just focus on the supply-side.

Thisn ignores the fact that Australia has had one of the highest rates of housing construction in the developed world:

Housing construction rates

Source: OECD Affordable Housing Database

We also have one of the highest numbers of construction workers per capita in the OECD:

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Construction workers per capita

Australia also ramped-up housing construction to record levels last decade (see second chart above).

The problem is that this surge in construction was swamped by the unprecedented jump in net overseas migration and population growth from 2005, which is projected to run even higher in the future:

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Net overseas migration

Growing Australia’s population by 400,000 to 500,000 people each year, as projected in the federal budget, inevitably means worsening housing shortages, higher rents, and increased homelessness.

Therefore, the number one solution is to reduce net overseas migration to levels that are commensurate with the country’s ability to build new housing, infrastructure, and services.

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Lowering immigration would also assist Australia in meeting its emissions reduction targets.

Unfortunately, the Teals are depressingly fake.

Given that the majority of the beneficiaries of the Teal’s insane population growth live in the “posh” suburbs represented by Spender and Steggal, I can think of no better place to dump migrants than high-density apartment skyscrapers from Bondi to Bronte. How about it Allegra?

About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.