New record migration numbers add pressure to strained housing market

Build it and they will come.

Well, they’re certainly coming but we’re definitely not building it.

Despite assurances to the contrary from the Federal Government, the number of migrants coming to Australia has hit record levels in the past year.

The government had pledged to reduce the migration flow into the country, at least in part because of the inability to house those already here, let alone those yet to arrive.

With the National Housing Accord’s pledge to build 1.2 million homes over the next five years already almost a million homes shy of its target, the latest arrivals data from the Australian Bureau of Statistics (ABS), makes for sobering reading.

Net permanent and long-term arrivals hit 57,270 in January, the highest number on record.

In the 12-months to January, almost half a million people entered the country. ABS data shows that on 1 January 2026, there were 2.98 million temporary visa holders staying or residing in Australia, the highest number on record, marking a 4.24 per cent growth from the previous year on 1 January 2025.

Dr Kevin You, Senior Fellow at the Institute of Public Affairs, said the size of Australia’s migrant population is growing larger than ever.

“Records continue to be smashed with this government’s promise to cut migration in absolute tatters, as half a million would-be migrants arrived on a net basis over the 12 months to January – the highest in recorded history,” Dr You said.

“Recent claims that net overseas arrivals are coming down seek to mislead Australians into thinking that there are fewer migrants in the country than before. This is false. The number of migrants in Australia is still growing to record levels month after month,” said Dr You.

“The federal government’s half-hearted amendments to the nation’s visa rules have failed to deter a wave of settlers who intend to stay in Australia for the next 12 months and beyond.”

Property affordability worsening

The surge in arrivals is occurring against a backdrop of already severe housing undersupply, with vacancy rates near historic lows and rents continuing to climb across most capital cities.

While migration is a key driver of economic growth and labour force expansion, its immediate impact on housing demand is undeniable.

Each additional household formed is placing further pressure on an already constrained system, particularly in major cities where new supply has struggled to keep pace.

The Federal Government has consistently argued that migration settings are being recalibrated to ease this pressure. In late 2025, it announced measures aimed at reducing net overseas migration, including tighter student visa requirements and caps on certain visa categories.

Treasurer Jim Chalmers has previously acknowledged the tension between population growth and housing availability, noting that while migration is essential to the economy, it must be “properly managed” alongside infrastructure and housing delivery.

Housing Minister Julie Collins has also pointed to the National Housing Accord as a key plank in addressing supply shortages, with the government working alongside states and the private sector to accelerate construction.

However, industry groups and economists remain sceptical about whether supply can be ramped up quickly enough to meet demand. Labour shortages, high construction costs and planning constraints continue to limit the pace of new housing delivery.

Even under optimistic scenarios, there is likely to be a lag between population growth and new housing completions, meaning pressure on rents and purchase prices may persist in the near term.

For the property market, strong population growth is underpinning demand, but without a corresponding lift in supply, affordability challenges are likely to intensify.