{"id":250518,"date":"2025-10-30T08:30:14","date_gmt":"2025-10-30T08:30:14","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/250518\/"},"modified":"2025-10-30T08:30:14","modified_gmt":"2025-10-30T08:30:14","slug":"canadas-housing-lesson-for-australia","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/250518\/","title":{"rendered":"Canada&#8217;s housing lesson for Australia"},"content":{"rendered":"<p>Economists at one of Canada\u2019s largest banks, Toronto-Dominion Bank, <a href=\"https:\/\/economics.td.com\/ca-dial-back-of-immigration-intended-impacts\" rel=\"nofollow noopener\" target=\"_blank\">published a report<\/a> assessing the impacts of the Canadian government\u2019s \u201cpopulation freeze\u201d, which aims to alleviate pressures on the nation\u2019s economic and social infrastructure.<\/p>\n<p>Last year, the government introduced an immigration plan to right-size non-permanent residents (NPRs) and permanent resident (PR) targets to allow for some \u201ccatch up\u201d in the needed infrastructure.<\/p>\n<p>The policy shift has seen a massive reduction in Canada\u2019s population growth from a multi-decade high of 3.2% in Q2-2024 to just 0.9%:<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/10\/Canadian-population-growth.png\" width=\"660\" height=\"490\" alt=\"Canadian population growth\"\/><\/p>\n<p>Advertisement<\/p>\n<p>The economists at TD Bank note that the lower population growth policy has had a dramatic impact on the rental market:<\/p>\n<p>\u201cReduced immigration has moderated demand for purpose-built rentals and, consequently, rent growth\u201d, the economists wrote.<\/p>\n<p>\u201cWe estimate rent growth will likely average 2 percentage points (ppts) lower than the counterfactual scenario of maintaining higher population growth\u201d.<\/p>\n<p>Advertisement<\/p>\n<p><img src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/10\/Canadian-purpose-built-rents.png\" width=\"660\" height=\"496\" decoding=\"async\" loading=\"lazy\" alt=\"Canadian purpose-built rents\"\/><\/p>\n<p>\u201cCondo asking rents are also falling fastest in jurisdictions most exposed to immigration changes\u201d.<\/p>\n<p><img src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/10\/Canadian-asking-rents.png\" width=\"660\" height=\"498\" decoding=\"async\" loading=\"lazy\" alt=\"Canadian asking rents\"\/><\/p>\n<p>The TD Bank economists also show that NPRs (temporary migrants) are most concentrated in the rental market:<\/p>\n<p><img src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/10\/Canadian-NPRs-versus-rents.png\" width=\"660\" height=\"485\" decoding=\"async\" loading=\"lazy\" alt=\"Canada NPRs\"\/><\/p>\n<p>Advertisement<\/p>\n<p>This is important, as the departure of NPRs has driven the reduction in population growth and ergo rents:<\/p>\n<p><img src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/10\/Canada-population-growth.png\" width=\"660\" height=\"526\" decoding=\"async\" loading=\"lazy\" alt=\"Canadian population change\"\/><\/p>\n<p class=\"wp-caption-text\">Source: Ben Rabidoux<\/p>\n<p><img src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/10\/Canada-NPLT-arrivals-versus-rents.png\" width=\"660\" height=\"515\" decoding=\"async\" loading=\"lazy\" alt=\"NPRs vs rental growth\"\/><\/p>\n<p class=\"wp-caption-text\">Source: Ben Rabidoux<\/p>\n<p>Advertisement<\/p>\n<p>The TD Bank economists also argue that Canada\u2019s current unemployment rate would likely be at least 1 ppt higher if immigration growth had continued unabated:<\/p>\n<p><img src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/10\/Canadas-unemployment-rate.png\" width=\"660\" height=\"495\" decoding=\"async\" loading=\"lazy\" alt=\"Canada's unemployment\"\/><\/p>\n<p>\u201cRe-adjusting immigration targets came at an opportune time\u201d, the economists wrote.<\/p>\n<p>Advertisement<\/p>\n<p>\u201cIf the labour growth rates of the prior two years were maintained through 2025, we estimate today\u2019s unemployment rate could have breached 8% (Chart 5). This is with an assumption that employers absorb 30% of the new labour supply, reflecting the recent trend of weakening demand\u201d.<\/p>\n<p>\u201cEven under a more generous assumption that employers absorb 50% of the new labour supply, the national unemployment rate would still have risen to over 7.5%\u201d.<\/p>\n<p>Finally, the TD Bank economists forecast that per capita spending has increased due to the slowdown in immigration, which has resulted in fewer low-paid, low-spending NPRs (temporary migrants) in the economy.<\/p>\n<p><img src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/10\/Canadian-per-capita-spending.png\" width=\"660\" height=\"482\" decoding=\"async\" loading=\"lazy\" alt=\"Canadian NPRs\"\/><\/p>\n<p>Overall, the TD Bank economists give their tick of approval to Canada\u2019s immigration cuts.<\/p>\n<p>Advertisement<\/p>\n<p>\u201cThe federal government\u2019s revised immigration policy is beginning to pay dividends in returning balance to a stretched social infrastructure\u201d, the economists wrote.<\/p>\n<p>\u201cIt has contributed to easing pressure in the national housing market\u2014particularly in rentals \u2014 and has stemmed a harsher run-up in unemployment during a challenging economic period. And, in a twist, the real economy has not absorbed a significant negative hit to consumer spending, although it remains early days on this analysis\u201d.<\/p>\n<p>Given that Australia is suffering acute housing and infrastructure pressures, poor productivity growth, and its labour market is being propped up by unsustainable government spending and non-market jobs, Australian policymakers should emulate Canada\u2019s immigration cuts.<\/p>\n<p>Sadly, the Albanese government has chosen the opposite approach by raising the effective permanent migrant intake to an all-time high and increasing the international student planning level for 2026.<\/p>\n<p>Advertisement<\/p>\n<p><img src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/10\/Net-Overseas-Migration-Joiner.jpg\" width=\"660\" height=\"536\" decoding=\"async\" loading=\"lazy\" alt=\"Australian immigration\"\/><\/p>\n<p>As a result, Australia\u2019s immigration intake will remain at historically high levels and the rental crisis will inevitably worsen.<\/p>\n","protected":false},"excerpt":{"rendered":"Economists at one of Canada\u2019s largest banks, Toronto-Dominion Bank, published a report assessing the impacts of the Canadian&hellip;\n","protected":false},"author":2,"featured_media":250519,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164],"class_list":["post-250518","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/250518","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=250518"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/250518\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/250519"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=250518"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=250518"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=250518"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}