Unfair blame targeted at international students for Australian rental crisis

Australia's student accommodation sector asserts that international students, constituting merely 4% of the rental market, are unfairly blamed for the nation's rental crisis.

A report from the Student Accommodation Council explains that several factors like smaller households, people moving within the state, and turning spare rooms into offices have affected the availability and cost of rent in Australia. It argues that international students are wrongly blamed for the rental crisis, emphasising that many reasons, including a lack of housing options and high demand, contribute to the problem.


The council suggests that instead of blaming students, efforts should focus on increasing housing options for all students arriving in Australia. Factors like people moving to rural areas during the pandemic, population growth, and high house prices also contribute to the increased demand for rentals. Challenges to providing more housing include high construction costs, a shortage of skilled workers, planning rules, and not enough infrastructure in cities.


Long approval processes for rental property projects contribute to delays in their completion, according to the report. Additionally, the report aims to dispel misconceptions regarding international students' impact on rental demand, costs, and displacement of Australian residents. It highlights that rents started rising in 2020 despite a decline in international student arrivals, with median weekly rent increasing by 30% from 2019 to 2023, while student visa arrivals dropped by 13% during the same period.


The paper discovered that only 13 out of Australia's 556 Local Government Areas have over 10% of their renting population consisting of international students. It highlighted that the majority of LGAs (73%) have less than 1% concentration of international students, indicating their limited presence in rental markets. Similar challenges with housing shortages have been observed in countries like the Netherlands and Canada, despite regional variations. 


Furthermore, the report emphasised that the anticipated increase in purpose-built student accommodation won't meet future demand, with projected new beds by 2026 insufficient to ease pressure on the rental market. Increasing PBSA supply could accommodate a growing student population while reducing strain on rental demand. The report also emphasised the need to address broader issues driving up rents and reducing housing supply, rather than singling out a specific group. To maintain the current proportion of international students in purpose-built accommodation, an additional 66,000 new beds are required by 2026, preventing more international students from relying on the private rental market.


PBSA is being highlighted as a potential solution, responding to research from The Institute of Public Affairs indicating a projected shortfall of 252,800 units by 2028. The conservative think tank's suggestion that student visa holders exacerbate the housing shortage is being challenged directly by the new report. 


Stakeholders at the AIEC conference in Adelaide emphasised maximising both homestay and PBSA to address shortages, echoing Recommendation 10 of the trade subcommittee report from October, which urged government action to foster the expansion of the PBSA sector. 


The committee expressed concerns about unfairly blaming international students for broader housing market pressures and identified challenges such as slow planning systems and high property taxes hindering new projects. Darling stressed the importance of providing international students with quality housing, given their significant contribution to the Australian economy, and called for government collaboration to increase professionally managed, purpose-built student accommodation to ease pressure on the private rental market.


Source: PIE NEWS


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