Temporary visas up by half-a-million
Australia’s rapid rebound in temporary visa holders will help to redress the balance in the labour market but is also going to add substantially to the rental crisis.
That analysis is according to Pete Wargent, co-founder of Australia’s first national marketplace for buyer’s agents, BuyersBuyers.
Mr Wargent said, “the number of temporary visa holders surged more than half-a-million higher over the year to September 2022, rising to 2.15 million from 1.64 million a year earlier.
“It’s great to have students, visitors, working holiday makers, and other temporary visa holders coming back to Australia, and in aggregate this new supply will go some ways to bringing labour force capacity constraints back into balance.
“The Reserve Bank has also cooled demand in the Australian economy through lifting interest rates.
“Of course, a substantial part of the increase was for visitor visas, which have rebounded from just 39,000 a year earlier to 271,000.”
“But it’s also been great to see a strong year-on-year increase in working holiday visas from 30,000 to 72,000, and in international student visas, from 318,000 to 369,000.
These numbers have been held back by expensive flights, but at least they are trending higher now.
“To date, the rebound in permanent and skilled migrants has been relatively modest, and this trend is only likely to gather pace in 2023.
“But the temporary visa holder figures excluding visitors have broadly returned to pre-pandemic levels, with further increases likely next year” Mr Wargent said.
BuyersBuyers CEO Doron Peleg said that for now the number of international students in Australia is well down on pre-COVID levels.
“In the September quarter of 2019, the number of international student’s temporary visas were more than a quarter of a million higher at 684,000, as compared to an equivalent figure of 369,000 in 2022,” he said.
“There has been a massive increase in offshore visa applications in 2022, but also a strong increase in refusals for offshore applications.
“Previously we saw very high numbers of international students from China, but these numbers have been lower over recent times.
“We expect the student numbers to rise over the period ahead, which will be a positive for redressing labour shortages, but will also add significantly to the demand for rental property.”
Mr Pete Wargent said that there was no end in sight for the rental crisis, but there were some signs of rental demand shifting back towards the inner- and middle-ring suburbs of Sydney and Melbourne, and away from some outer-suburban and regional markets.
“The pandemic period saw a dramatic movement outwards in rental demand, away from density, and we also saw a significant decline in the average household size,” he said.
“This was a rational response to a pandemic, with tenants seeking more space, with less demand for share housing and high-rise unit blocks with shared facilities, including lifts.
“While the movements have only been gradual, there has been some softening in demand in lifestyle and hinterland areas.
“Some outer suburban housing estates are also struggling to cope with the additional traffic on the roads, with many commuters shunning public transport options. This may reduce demand for some outer-suburban rentals.
“Most new arrivals into Australia are renters, and mostly they arrive in the heart of Sydney and Melbourne, so the bulk of the increase in rental demand over a coming couple of years is set to be in those two capital cities.”