Immigration levers and the apartment oversupply scenario: Pete Wargent

In Britain the topical political and media talk is of whether an "Australian-style" points based immigration system should be introduced, without any real clarity about what that would mean in practice.

 

Back Down Under it's often said that Australia's population growth must slow if the economy isn't creating enough jobs. This is essentially true for 457 visas, but does overlook the potential underlying demand for other visa classes.

 

I previously looked at the newly relaxed international student visa rules which were made effective from 1 July, easing the rules for parents and guardians of primary school age students in Australia.

The recent election campaign also led to some potentially interesting shifts via proposed policies for...

 

 

With standard parent visas presently capped at 1,500 per year, a queue of this size at 30 June equated to a ridiculous 25.8 year average wait time for an application to be processed. 

 

 

During a keenly contested election campaign the Australian Labor Party (ALP) announced plans to extend visitor visas to parents out to a far more palatable three years - with parents only being required to leave the country for four weeks at the end of each visa term and paying a $5,000 bond to ensure cover for medical and social services.

Surely a potential vote-winner for the ALP in the rapidly growing migrant communities, particularly in an era where so many young families also strive to be dual-income households. 

 

As tends to be the way of these things, the Coalition's knee-jerk response was to announce a new parent visa plan itself, especially aimed at Chinese and Indian visitors (provided that new arrivals pay for health insurance and don't rely on the welfare state for health care, shamelessly piggybacking from the ALP proposals!) and allowing for continuous five year visitor visas. 

 

Given that the number of overseas born Aussies is soon to pass 7 million, such a policy could potentially lead to hundreds of thousands of applicants for visitor visas from parents sponsored by Australian citizens, largely from ageing, non-English speakers hailing from Asia (which is not really the ideal target demographic for policy makers).

For this reason the Coalition's proposed policy denotes that parents of Australian citizens and permanent residents who have lodged a permanent parental visa application "may" be issued a five year visa "on a case-by-case basis". 

 

In other words, this is an 'out'. Minister Dutton has the discretion to limit the number of visas issued and retains the right for policy to change course henceforth. 

 

 

At this juncture there appears to be very little clarity surrounding what will happen with respect to parent visas.

 

The Coalition probably doesn't know the answer itself, election pledges doubtless being dreamed up on the hoof in response to the ALP's evidently popular proposal. 

 

A point here relevant to the property markets is that if Australia does end up with an oversupply of thousands of apartments as many have forecast, there are levers that can be pulled to loosen immigration policies.

 

After all, a sceptic would say that if there's a policy that's always guaranteed to garner support from governing parties of either persuasion, it's one aimed at propping up ailing capital city housing markets.