Immigration, Property and the 2025 Election

Immigration, Property and the 2025 Election

With a federal election approaching in May, debates about immigration policy and housing affordability are intensifying. Historical data reveals a clear pattern: shifts in government directly influence population growth, foreign investment, and housing demand. This article examines immigration trends, foreign investment approval patterns, and price movements under past governments, offering a fact-based framework to navigate uncertainty.?


With a look at previous government policies, we can gain valuable insights into how these factors interact and shape economic outcomes.?


1. Howard (1996–2007):??

Expanded skilled migration programs and foreign investment rules.?

Key Statistics:?

  • Migration:?

  • Net Overseas Migration (NOM) averaged?97,000 annually, peaking at?177,000 in 2006?as skilled migration programs expanded.?

  • Price Growth:?

  • National median house price?rose?124%??

Population growth driven by skilled migrants correlated strongly with price gains in major cities, particularly in Sydney and Melbourne where demand for housing intensified.?

?


2. Rudd/Gillard (2007–2013):??

Relaxed foreign investment rules (2008) to attract foreign buyers post-crisis.?

Key Statistics:?

  • Migration:?

  • NOM dipped to?171,000 in 2009?post-GFC, then rebounded to?240,000 by 2012.?

  • Price Growth:?

  • National prices fell?8%?during the 2010–2012 credit crunch but recovered by 2013.?

Policy shifts post-GFC stabilised markets, but price recovery lagged until migration rebounded. The apartment boom in Melbourne highlighted the influence of targeted foreign investment on specific property types.?

?

3. Abbott/Turnbull/Morrison (2013-2022)?

  • Migration:?
  • Net Overseas Migration (NOM) averaged?210,000 annually?pre-COVID, peaking at?264,000 in 2019. -88,000 NOM during COVID in 2021.?
  • Price Growth:?
  • COVID rebound: Prices jumped?22.4% nationally?(2020–2022) due to stimulus (HomeBuilder grants, 0.1% rates) despite near-zero migration.?

Prices soared?despite negative migration, proving low rates and stimulus can override population trends.?

?

4. Albanese (2022–Present):??

?Post-COVID migration surge, with 454,000 arrivals in 2022–2023.?

Key Statistics:?

  • Migration:?

  • Post-COVID surge:?454,000 NOM in 2022–2023, the highest on record.?

  • Price Growth:?

  • National prices rebounded 4.9% in 2024, led by Perth (+19.1%) and Adelaide (+13.1%).?

Migration-driven demand is strongest in affordable markets with rental shortages, highlighting the structural challenge of supply meeting surging population growth.?

?

What is the FIRB and Why Does It Matter??

The Foreign Investment Review Board (FIRB) is an Australian government body that reviews and approves significant foreign investment proposals. Its policies and decisions can have substantial implications for the housing market by influencing where and how foreign capital is allocated. Analysing FIRB data provides a window into emerging market trends and potential price movements.?

  • Brisbane & Perth: Rising FIRB approvals (+22% and +18%) align with strong price growth (8.7% and 19.1%), suggesting foreign investment is reinforcing demand in these markets.?

  • Sydney & Melbourne: Declining FIRB activity (-12% and -5%) coincides with price stagnation or declines, reflecting affordability barriers and investor caution.?

FIRB data often signals emerging trends—regions with growing approvals tend to see price momentum within 12–18 months.?

?

Election Implications: What History Tells Us?

  1. Policy Shifts Matter: Changes to migration caps or FIRB rules (e.g., 2008 relaxation, 2017 foreign buyer taxes) have historically redirected investment flows.?
  2. Supply-Demand Imbalance Persists: Only 170,000 homes were built in 2023 versus an annual demand of 240,000—a gap worsened by high immigration.?
  3. Regional Resilience: Affordable cities like Perth and Adelaide outperformed in 2024, suggesting investors are pivoting to markets less impacted by rate rises.?

?

Key Considerations for Investors?

  • Migration Lag Effect: Population growth typically impacts prices after 2–3 years. Current record migration (2022–2023) may fuel demand in 2025–2026.?

  • FIRB as a Leading Indicator: Rising approvals in Brisbane and Perth suggest sustained appetite for these markets.?

  • Rental Shortages: Vacancy rates below 1.5% in migrant-heavy cities signal long-term rental yield potential.?

?

While election outcomes may alter migration settings, Australia’s housing shortage remains a structural challenge. Markets with balanced affordability, job growth, and infrastructure investment – such as Brisbane and Perth – are likely to remain focal points for demand, irrespective of immigration policy changes.??

?

This is a nice read and showcases the incredible influence government policies have over the property market.

回复
Alexey Dubrovin

We create software from your dreams. NoBS Developent. Custom mobile, SaaS and AI chats solutions. Building network of trust and advocacy.

3 周

This is a comprehensive breakdown of how immigration and government policies have shaped Australia's property market over the years! The interplay between migration, foreign investment, and housing demand is fascinating, especially when looking at how different governments have influenced these factors. The data-driven approach really helps in forecasting trends for investors.

Ivan Schwartz

☆ 4Purpose Disruptor ? Points4Purpose boosts customer lifetime value while empowering member choice - redeeming cash rewards or donating to their favourite cause - seamlessly!

3 周

This analysis explores the link between immigration policy, foreign investment, and housing affordability. It highlights how policy shifts, such as migration caps and FIRB rules, impact housing demand and prices. The post-COVID migration surge, rental shortages, and FIRB’s role as a market indicator emphasize ongoing supply challenges. With the federal election ahead, these factors are key to shaping future housing trends. Great insights!

Caroline Kennedy

Former 9-Figure CEO | Advisor to Australia's Top CEOs & 7-8 Figure Business Owners | Known for Achieving 100%+ Client Growth in 12 Months | 2 x Telstra Awards

3 周

This is a well-researched breakdown of how political shifts influence migration, foreign investment, and housing markets. The historical trends highlight the interplay between policy decisions and property demand, reinforcing the importance of long-term planning for investors. With affordability challenges persisting, it’s clear why cities like Perth and Brisbane are gaining traction. It’ll be interesting to see how the election shapes the next phase of market movements.

Steve Bambury (A.npn)

Associate Neuroplastician? | Digital Growth Engineer | Data Insights Strategist | Author | Pioneering the 'build websites backwards' methodology & the 'Digital Sales Concierge' | Ex Royal NZ Navy ?

3 周

Thank you for sharing this insightful analysis of the relationship between government policies, immigration, foreign investment, and housing demand. It's one big melting pot and this certainly assists to make some sense from it all!

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