With people waiting to inspect rentals lining up around the block, much has been made of the current housing crisis.
It’s true that Australia’s rental market has never been so overheated. Vacancy rates across our major cities hover around one per cent while the cost of rent has skyrocketed. Put simply, there are less homes to rent and those renting are paying more.
As the borders opened post-Covid and international students streamed back into Australian universities, many pointed the finger squarely at students. International students, some claimed, were the reason average Aussies couldn’t find a place to rent.
If only it were true.
Our research has shown international students only make up four per cent of the rental market and prefer to live in student accommodation and apartments in CBDs and close to universities. They aren’t competing with families for suburban homes.
But that hasn’t stopped both sides of government taking aim at international students.
In the Budget in Reply speech last week, the Opposition laid its policy to cut international student numbers.
Cutting those numbers, for the sake of four per cent of the rental market could significantly harm our international education sector, which generates a staggering $49 billion annually.
These are the very students who support and bring energy and vibrancy to our CBDs still bouncing back from the pandemic.
They are crucial to Australia’s economy, enrich and enliven our cities and enhance Australian diplomacy globally.
Many complex factors, built over decades, hinder the supply of rental homes and boost demand, all within a high inflation environment.
Blaming students, who are essential to our university sector and fill skill gaps in our cities, for Australia’s overheated rental market is not only unfair but also highly damaging to our reputation as a welcoming country.
We need to look at the broad spectrum of issues driving up rent and reducing the supply of homes, rather than blaming a single cohort.
The Australian Government recognised the critical role purpose-built student accommodation sector (PBSA) plays in providing a first-class experience for international students in its Budget last week, a historic first.
The government said it will work with the higher education sector on new regulation to require universities to increase their supply of student accommodation for domestic and international students.
We know the fastest way for universities to add the student accommodation is to partner with the private sector.
Private sector PBSA providers, developers and operators are the answer for universities concerned about a cap on their international student numbers.
Universities can work with the sector to fill existing beds today.
Then we can work on building out the pipeline of future projects.
The existing pipeline of new purpose-built student accommodation developments falls short of future needs – with the projected 7,770 new beds due to come online by 2026 not enough to alleviate demand in the private rental market.
The Student Accommodation Council is a key stakeholder consulting directly with the Government about what their PBSA reforms will look like. If you are a PBSA owner, operator or developer that would like to play a key role in advising Government about what is, and isn’t workable, please reach out to me today.
Providers of purpose-built student accommodation are creating world-class buildings that offer tailored living options for students and help alleviate pressure on the rental market.
Instead of looking for scapegoats, let’s seriously reckon with our broken housing system.