Home Insights Where Are Australia’s 3.5 Million New Residents Going To Live?

Where Are Australia’s 3.5 Million New Residents Going To Live?

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Population growth has begun to grow again after falling off a cliff during the COVID-19 pandemic and its associated border closure and immigration program outages.

In fact, according to the latest forecasts from the Population Center, the country is projected to add another 3.5 million inhabitants over the next decade.

And this is a relatively modest number, no matter how loud it may sound. This assumes a growth rate slightly below what was seen in the five years prior to COVID.

Aside from that, it’s important to maintain housing supplies as our population grows – and the outlook is bad.

have It is important to properly supply the property to the buyer and the borrower as well. To ensure affordable housing and security. Unfortunately, the supply of new housing has generally not kept up with demand over the last few decades.

Determining a shortage is not easy.

Estimates start with assumptions about average household size, population, and net housing perfection. More difficult to quantify is the percentage used for villas, short-term rental properties such as Airbnbs, or intentionally emptied investment property.

The collapse of population growth over the last two years has helped some of these factors catch up. HomeBuilder grants are also having an impact, with 30% more homes being built in 2021 compared to 2019.

However, this increase in new builds is in line with and contributes to a very difficult situation for the construction industry.

Despite high demand 328 construction companies came into power in the December 2021 quarter Alone, according to the Australian Securities and Investment Commission.

Australia’s population is once again about to continue to grow rapidly.Photo: Getty

Build time and cost surged

According to a survey by members of the Housing Industry Association, the average time it takes to build a home in March this year reached 12 months, 50% longer than the pre-COVID average.

When the build time is long, Rapid increase in costIt is exacerbated by labor shortages, supply chain disruptions, and rising raw material prices.

Since March, the supply chain has been further hampered by sanctions against Russia, including the blockade of COVID-19 in China and a 35% increase in tariffs on imports of goods from Russia and Belarus.

We haven’t built enough homes to accommodate the growing population, and problems in the construction sector are exacerbating the situation.Photo: Getty

Demand to build decline as risk increases

Especially since the collapse of the big construction companies ProBuild and Condev, the cracks in the construction industry have received more publicity and people have become more nervous.

As well as the risks left in the building, those considering construction should weigh higher construction costs against longer construction times. This often means more time to pay the rent.

Among those who previously wanted to build, these additional risks and costs could limit some Australians to purchases from existing asset pools.

This affects the supply.

In 10 years, the national population will increase by about 3.5 million.Photo: Getty

Australia’s housing supply is overwhelmingly produced by the private sector. With the termination of HomeBuilder, housing approval has already dropped by 36% in the year leading up to March.

Many measures have been proposed to increase supply. This includes tax changes for planning and regulatory reforms.

Reforms are needed to address this issue, but supply prospects will not recover significantly until construction pain is eased.

This means that there is likely to be an imbalance between future buyer demand and available home inventories.

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