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Media release: Capping international students will not fix housing affordability or supply

May 1, 2024

An economic analysis undertaken by the Group of Eight (Go8) which represents Australia’s leading research-intensive universities, demonstrates there is no direct link between international student numbers and the nation’s current housing crisis.

Go8 universities either provide or facilitate access to accommodation that caters for over 83,000 students. This is equivalent to approximately two international students at a Go8 university for every per student accommodation supply.

Go8 Chief Executive Vicki Thomson said “we recognise that international student demand for housing is stronger in some inner city areas of Sydney and Melbourne where demand already exceeds supply, which is why Go8 universities and purpose-built student accommodation providers are investing heavily in affordable student accommodation options. Our universities also have a substantial forward plan of additional supply across the next decade.”

The Go8 policy paper, International students and housing and other cost of living pressures reveals the housing affordability and more general cost-of-living crisis is fundamentally a supply side problem, rather than attributable to international student numbers.

“The number of international student arrivals has no direct bearing on underlying supply side factors which include decades of underinvestment; Government regulation, planning approvals, elevated construction costs and workforce shortages; supply chain disruptions; and weak productivity growth,” said Ms Thomson.

“These supply issues cannot be solved overnight and regardless of international student intake, Australia would still be facing a housing crisis.  Any plans to impose a cap on international students as one mechanism to ease housing pressure – especially during a domestic skills crisis – is shortsighted and risks putting a brake on Australia’s economic growth and prosperity.   

“We caution against apportioning blame to one cohort of students who were responsible for most of the nation’s economic growth. In 2023, following a downturn during the COVID-19 pandemic, total spending by international students bounced back to $47.8 billion. International students contributed an 0.8 per cent increase in GDP over 2023 (more than half of the recorded 1.5 per cent economic growth) according to the National Australia Bank. 

“International education is one of Australia’s greatest export success stories and is critical to our future prosperity. Australia is in a global race for top international students who go on to earn advanced qualifications and help Australia’s drive to become a knowledge economy. Only around 16 per cent of international students who study in Australia remain long term, but those who do contribute to our skills and talent pool in critical areas such cyber security, defence, engineering and energy sectors. We need to encourage more high-quality international graduates to stay longer. 

“The Go8 is not advocating for an open slather approach and backs the Government’s goal to embed quality and restore integrity at all levels of the broader education sector. We need to target and retain high quality students to supplement our domestic workforce where there are skills gaps, and to boost sovereign capability.”

Contact: Vicki Thomson, Group of Eight Chief Executive on +61 438 047 155

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