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Migration cuts unlikely to have big impact on dwelling shortage

by Staff Reporter8 minute read
The Adviser

Government plans to decrease migrant intake are expected to ease the tight rental market but dwelling supply is unlikely to swell as a result of years of underbuilding across the country.

Kevin Rudd said yesterday that the government would decrease this year’s skilled migrant intake by about 18,500 places in a bid to safeguard Australian jobs.

AMP Capital economist Shane Oliver said this could reduce dwelling demand by up to 6,000 or 7,000 dwellings, according to The Australian Financial Review.

However Jason Anderson, senior economist at BIS Shrapnel, said Australia’s long history of underbuilding would see supply remain tight.


“A reduction in the order of 20,000 people would reduce demand a little bit but we are still substantially underbuilding,” he told the daily.

“This is being done with the backdrop of a lot of Australians returning from overseas,” he added, “so there are offsetting forces here.”

Australia’s market is notoriously undersupplied, especially in the eastern states.

Last week a government report estimated that the current dwelling shortage of 85,000 could blow out to 203,000 by 2013 and so much as 431,000 by 2028.



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