Australia’s student housing woes won’t be solved by cutting visas

Australia’s universities are a magnet for foreign students, especially from Asia. The share of international student enrolments in higher education is much higher than in other advanced economies. At some universities, it exceeded 40 per cent in 2022, according to Australia’s Department of Education.

The clampdown has already led to a sharp rise in visa rejection rates. It has also drawn fierce criticism from international education lobby groups, with the International Student Education Agents Association accusing the government of “sacrificing international students as a means to showcase [its] toughness” on migration.

A dispassionate assessment, however, shows a more nuanced picture. First, visa approvals fell sharply for English language and VET courses but were only slightly down for university courses. Indian and Pakistani students applying from abroad bore the brunt of the rejections.

It recommends raising student visa fees sharply – which is unlikely to deter talented students from attending Australia’s top universities – to help raise rent assistance. “The alternative is a cap on student visas, which wouldn’t provide extra revenue to help renters,” said Trent Wiltshire, deputy director, migration and labour markets at the Grattan Institute.

The Property Council of Australia has urged federal and state governments to provide clear planning approval pathways for PBSA. It also says the sector should be on an equal tax and regulatory footing with the BTR market, especially since student housing is a more established sector.

Planning restrictions are constraining supply in all sectors of Australia’s residential property market, driving up prices and rents. Australia’s student visa system needed reform, but it is the