Can Australia Cut Migration and Still Build the Homes It Promises?

Australia is engaged in two major debates that are usually conducted separately.

The first concerns migration. Has Australia accepted more people than its housing, transport and public services can accommodate? Should migration be reduced—and, if so, by how much?

The second concerns housing. How can Australia build the enormous number of homes governments say will be required over the coming decade?

These debates are directly connected.

Reducing migration could lessen the rate at which housing demand grows. But if the reduction also removes builders, tradespeople, engineers and other essential workers, it could weaken Australia’s capacity to construct the homes it has already promised.

That presents an uncomfortable question:

Can Australia reduce migration without also reducing its ability to build housing and operate the businesses on which its economy depends?

Migration is already falling

The public discussion can sometimes create the impression that migration is continuing to rise unchecked. The Australian Bureau of Statistics tells a more complicated story.

Net overseas migration fell from approximately 429,000 people in 2023–24 to 306,000 in 2024–25. Migrant arrivals declined by 14%, while departures increased.

International-student arrivals fell from approximately 204,000 to 157,000. Arrivals of other temporary visa holders also declined.

This means Australia is not merely considering a future reduction. A substantial reduction has already begun.

It is also important to understand that net overseas migration and the permanent Migration Program are different measures.

Net overseas migration counts the difference between people arriving and leaving who meet the ABS definition of a migrant. It includes many temporary residents, such as international students, working-holiday makers and temporary skilled workers.

The permanent Migration Program determines how many permanent visas are available in particular categories. For 2026–27, approximately 71% of the permanent program is allocated to skilled migration.

Reducing permanent skilled migration, international-student numbers and working-holiday arrivals would produce different consequences. Treating them all as a single group conceals more than it explains.

The policy question should not only be, “How many migrants should Australia accept?”

It should also be:

Which migrants, possessing which skills, are needed—and where?

The case for reducing migration

There is a legitimate argument that Australia’s recent population growth has exceeded its capacity to provide housing and infrastructure.

Every newly arrived person requires somewhere to live. In the short term, migrants add to housing demand before any contribution they make to housing supply can be realised.

The pressure is particularly visible in rental markets. International students, working-holiday makers and recently arrived skilled workers are more likely to rent when they first arrive. Many settle in capital cities, placing additional demand on apartments and other rental accommodation close to education, employment and transport.

Victoria illustrates this clearly.

In the year ending December 2025, net overseas migration added approximately 85,000 people to Victoria’s population. That was considerably more than the state’s natural population increase and offset a small net interstate migration loss.

A sustained reduction in arrivals could therefore:

• Slow the growth in demand for rental properties.

• Moderate pressure on vacancy rates and rents.

• Reduce demand for inner-city apartments and student accommodation.

• Ease pressure on transport, hospitals, schools and other services.

• Reduce the number of additional homes required to accommodate future population growth.

These potential benefits should not be dismissed.

However, lower migration would not automatically make existing homes affordable. It would not resolve planning delays, high construction costs, infrastructure shortages, financing difficulties, land availability or the existing shortage of social housing.

Reducing population growth may slow the rate at which the housing problem becomes worse.

It does not necessarily solve the problem Australia already has.

The Metricon warning

The risk on the other side of the equation was illustrated by Metricon CEO Brad Duggan during an ABC 7.30 report broadcast on 18 August 2026.

The segment examined the construction industry’s reliance on overseas workers and its capacity to meet Australia’s housing targets.

Mr Duggan said that a significant reduction in migrant workers would be devastating for Metricon. He described a workforce in which particular migrant communities had developed strong representation and expertise across trades such as painting and plastering.

He could have continued through other parts of the building process. His central point was that migrant workers were not a theoretical future addition to Metricon’s workforce. They were already embedded within it.

Without that component of the workforce, the company’s capacity to build homes would be severely affected.

This evidence deserves attention because Metricon is not a policy institute making a projection. It is a major volume home builder describing the people it currently relies upon to complete homes.

It reveals the potential contradiction in a broad migration reduction.

A government could reduce migration in the hope of easing housing demand while simultaneously removing part of the workforce needed to increase housing supply.

Who is actually building Australia’s homes?

Jobs and Skills Australia estimates that the national construction workforce will need to grow from approximately 1.348 million people in 2025 to 1.508 million by 2035.

The occupations receiving temporary skilled visas for construction include:

• Carpenters

• Painting trades workers

• Civil engineers

• Wall and floor tilers

• Construction project managers

• Drainers

• Roof plumbers

• Contract administrators

• Welders

• Fitters

Temporary visa holders represented an estimated 5.4% of Australia’s construction workforce in the available 2021 analysis.

Primary temporary skilled visa holders alone represented less than 1% of the construction workforce in September 2025. That smaller figure is important because it prevents the migration contribution from being overstated.

Migration is not presently large enough to rescue Australia’s housing targets by itself.

Australia still needs to:

• Train and retain more local apprentices.

• Improve apprenticeship completion rates.

• Attract more women into construction.

• Prevent experienced workers from leaving the industry.

• Improve productivity and project management.

• Expand prefabricated and modular construction where appropriate.

• Make better use of qualified workers already living in Australia.

• Improve recognition of legitimate overseas qualifications.

Migration should not become an excuse for neglecting domestic training.

But domestic training takes years. An apprentice commencing today cannot immediately replace an experienced carpenter, plasterer, painter, plumber or construction manager.

Removing an established migrant workforce before a replacement exists would reduce capacity almost immediately.

Housing targets require more than land and approvals

The Victorian Government is seeking to enable 800,000 additional homes between 2024 and 2034.

Political parties are proposing land releases, planning reforms, higher-density development, public-housing construction and incentives for first-home buyers.

None of these policies can deliver a completed home without workers.

Planning approval does not pour a slab. Rezoning does not frame a house. A government grant does not install plumbing, plaster walls, paint rooms or connect electricity.

The housing system already faces competition for labour from:

• Major transport projects

• Hospitals and schools

• Renewable-energy infrastructure

• Commercial development

• Renovations and repairs

• Disaster reconstruction

• Public and community housing

If migration reductions include people with relevant construction skills, Victoria could experience:

• Longer construction time frames.

• Higher labour costs.

• Greater competition between government and private projects.

• More financially marginal developments being postponed.

• Further pressure on builders operating with narrow margins.

• Delays to public, affordable and private housing.

• A wider gap between announced housing targets and completed homes.

The irony is difficult to ignore.

Victoria may need fewer additional homes if migration falls, but it may also become less capable of building the homes still required.

Not all migration has the same housing effect

This is why a broad numerical target is inadequate.

A carpenter arriving with a partner and child adds three people to housing demand. But the carpenter may also contribute directly to constructing many homes over the following years.

An engineer may initially need rental accommodation but help deliver subdivisions, apartment developments or essential infrastructure.

An international student also requires housing and may not work in construction. But that student may work in a restaurant, hotel, cleaning business, supermarket or care service.

A working-holiday maker may create short-term rental demand while also providing flexible labour for hospitality, tourism, agriculture and regional businesses.

The balance between housing demand and economic contribution differs between these groups.

Australia cannot properly plan migration using one headline number while ignoring the composition of the intake.

What happens to hospitality and service businesses?

The workforce consequences extend well beyond construction.

Temporary migrants are particularly important to:

• Restaurants and cafés

• Hotels and accommodation

• Tourism

• Events and entertainment

• Cleaning and property maintenance

• Food production and distribution

• Agriculture and seasonal work

• Some areas of health and care services

ABS analysis found that Food and Beverage Services was the most common employment industry for temporary residents. It accounted for approximately 12% of their employment, while around 23% of employed international students worked in that industry.

These workers often provide the flexible labour needed during evenings, weekends, holiday periods and seasonal peaks.

A substantial reduction in international students and working-holiday makers could make recruitment more difficult, particularly in Melbourne’s hospitality districts and regional Victorian tourism communities.

Businesses would have to adapt.

Some may increase wages and improve conditions to attract more local workers. That could be a positive and overdue adjustment.

Others may introduce technology, simplify menus, reduce services or change their opening hours.

But the consequences could also include:

• Higher prices for customers.

• Reduced evening and weekend trading.

• Longer waiting times.

• Less service availability.

• Business closures.

• Reduced tourism capacity.

• Greater difficulty operating seasonal and regional enterprises.

Businesses do not have an automatic entitlement to inexpensive migrant labour.

At the same time, it is unrealistic to assume that a large flexible workforce can be removed without changing the price and availability of services.

If Australians want lower migration, they may also need to accept higher prices, reduced convenience or fewer businesses in some sectors.

That is part of the policy choice.

Migrants are people—not simply labour units

There is a danger in discussing migration solely in terms of workers and housing demand.

Migrants are people who establish homes, raise families, create businesses, pay taxes, purchase goods and services and contribute to communities.

Many become Australian citizens. Others return home after making a temporary contribution to the economy and cultural life of the country.

A responsible migration debate should neither dismiss the pressure rapid population growth can place on housing nor reduce migrants to an economic input.

The objective should be a migration program that Australia can accommodate properly and that gives new arrivals a reasonable opportunity to build secure lives.

That requires housing, infrastructure, employment and services to be considered before intake levels are established—not years afterwards.

Victoria’s financial exposure

For Victoria, lower migration would have consequences beyond housing.

Population growth contributes to consumer spending, business activity, university income and government revenue. Slower growth may reduce pressure on infrastructure, but it can also weaken the revenue base available to fund that infrastructure.

This matters when Victoria is already carrying high and rising debt while trying to finance housing, transport, health and education commitments.

International education is also a significant Victorian industry. A major reduction in students would affect universities, private education providers, accommodation businesses, retailers, hospitality venues and the broader inner-Melbourne economy.

Some rental markets might soften. Some businesses might also lose customers and workers at the same time.

The consequences would not be evenly distributed.

An inner-city apartment investor, a regional restaurant, a suburban home builder and a public-transport provider might all experience the same migration reduction very differently.

Could Australia target migration more effectively?

The choice does not need to be unlimited migration or indiscriminate cuts.

A more deliberate system could:

• Give greater priority to construction trades, engineers and other demonstrated shortage occupations.

• Reduce intake in categories that add substantial immediate demand without addressing important workforce needs.

• Link migration settings to credible housing and infrastructure capacity.

• Direct more skilled migrants toward regions with both employment and accommodation.

• Prevent employers from using migration to avoid training Australians or improving working conditions.

• Accelerate recognition of genuine overseas qualifications.

• Require employers benefiting from skilled migration to contribute to local training.

• Connect Commonwealth migration decisions with state housing plans.

• Publish the estimated housing and workforce consequences of major changes to migration levels.

This approach would still involve difficult decisions.

A worker cannot simply be directed to a region where employment, services or community connections are inadequate. Skilled migrants are people with choices, families and ambitions—not resources a government can allocate indefinitely.

Nevertheless, a migration policy designed around actual capacity and skills would be more useful than a political competition over one annual number.

Demand versus capacity

The migration and housing debate eventually returns to a fundamental balance.

If migration remains too high relative to housing construction, rental and infrastructure pressures will continue.

If migration is reduced too quickly or in the wrong categories, construction and essential service industries may lose workers before Australia has trained replacements.

Both propositions can be true.

The appropriate response is not to deny one side of the equation. It is to design migration, housing, training and infrastructure policies together.

Australia must decide:

• How many additional people can it reasonably accommodate?

• How many homes can it actually build?

• Which workers are required to build them?

• How quickly can Australians be trained for those roles?

• Which industries rely on temporary and flexible labour?

• What costs and inconveniences are Australians prepared to accept if that workforce contracts?

The uncomfortable question

Calls to reduce migration will remain politically powerful while Australians struggle to find affordable housing.

But a reduction described only as a number tells us very little.

Fewer migrants may mean fewer additional homes are required. If Australia also loses the people needed to construct homes, staff businesses and provide services, the apparent solution may create another set of shortages.

Metricon’s warning demonstrates that this risk is already present inside one of Australia’s largest home builders.

So, if Australia substantially reduces migration:

Who will build the homes governments have promised?

Who will staff the restaurants, hotels and service businesses on which Victoria depends?

How long will it take to train replacements?

And what additional cost are Australians prepared to pay while that transition occurs?

Australia needs to decide not only how many people it can accommodate.

It must also decide what workforce it needs to build and support the country it continues to promise.

Information in this article is current as at 19 August 2026.

This article is general information for real estate professionals and does not constitute welfare, legal, or financial advice.