While the government has attempted to curb net overseas migration, recent data shows these efforts have had limited success. This, coupled with an estimated housing shortage of 200,000 to 300,000 homes, has created a strain on the rental market, in major cities like Sydney and Melbourne.

Now, new evidence suggests a surge in international student arrivals due to visa extensions. This influx is expected to exacerbate the existing housing shortage, further driving up rental prices and making it even more difficult for Australians to find affordable accommodation.

Australia experienced a record population surge in the financial year ending June 2023, with 624,100 new residents. While 106,100 were due to natural increase, the majority, 518,100, came from net overseas migration (NOM). This surge in population has put immense pressure on the housing market, driving up rents and home prices.

The Albanese government has pledged to curb overseas migration, including reducing the number of international students, to address the housing shortage. However, the government's predicted NOM figure for the 2023-24 financial year has already been exceeded. The budget forecast 395,000 new arrivals, but the latest figures from the Australian Bureau of Statistics (ABS) show 388,000 new arrivals in the first three quarters of the year.

One reason for this unexpected increase is the extension of international student visas. While universities argue that international students have a minimal impact on housing, the Federal Education Department estimates that 7% of rental properties in Australia are occupied by international students. Despite the government's efforts to reduce the number of student visas issued, the number of international students in Australia reached an all-time high of 679,293 at the end of August. This continued influx of international students, coupled with the government's efforts to reduce departures, is putting further strain on the rental market, making it even more difficult for Australians to find affordable accommodation.

Despite the government's efforts to curb international student visas and crack down on "dodgy" education providers, the number of student, graduate, bridging, and skilled migrant visas has increased by 200,000 to 1.41 million in the 12 months ending August 2024. This surge in visa applications is making it difficult for the government to reach its net migration target of 260,000 for the 2024-25 financial year.

Many international students are switching to other visa types or applying for a second student visa, extending their stay in Australia. This is further exacerbated by the use of bridging visas, which are being used by rejected student visa holders to remain in the country. This trend is undermining the government's efforts to reduce the number of international students and is contributing to the "fewer departures" that Treasurer Jim Chalmers has acknowledged.

Experts predict that the net overseas migration figure for the current financial year will likely exceed 325,000 and could reach 350,000. This increase in migration is putting immense pressure on the housing market, particularly the rental market, as more people compete for limited housing options.

While the government is trying to tighten visa regulations, the education sector is pushing back, as international student fees are a source of revenue for universities. This creates a complex situation where the government is trying to balance its migration targets with the economic benefits of international students.

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