Australia caps international students to settle housing nerves

Australia is to cut the number of new international students amid growing public concern over record migration and a rise in housing costs.
The number of international students will be limited to 270,000 next year, forcing public universities to accept only about 145,000 new international students in 2025, down from 210,000 last year.
Vocational college enrolments will be halved to 95,000 and private higher education will be capped at 30,000.
International students account for half the flow of migrants each year to Australia. The numbers surged after the country lifted its pandemic border closures, putting net overseas immigration at a record 548,000 for the year to last September.
Polls now show voters are worried about large influxes of foreign students and workers putting excess pressure on the housing market, making immigration one of the potential contests in an election less than a year away.
Announcing the cuts to foreign student numbers on Tuesday, Australia’s education minister, Jason Clare, said some migrants had been using education as a “back door’’ to enter Australia. “It’s important to send a message to the world that we want international students to come here,’’ he said. “We want a managed system, not a free-for-all system.”
Public support for migration in Australia has fallen to its lowest level in five years, according to a poll released on Tuesday by Essential, with 42 per cent of those surveyed saying it was harming the country.
Rents in Sydney, Australia’s largest city, have risen by 9 per cent over the past year and by more than 13 per cent in Perth, the nation’s mining capital. House prices in Sydney are expected to rise by up to 8 per cent in the next 12 months, taking the median to a new high of A$1.76 million (£904,000), the property website Domain predicted in June. It said rising house prices were the result of strong population growth, increased borrowing capacity and a supply shortage.
There are also fears over rising unemployment. Last week the consulting firm Deloitte predicted a net rise of more than 100,000 in the number of unemployed Australians in the next 12 months, as the job market and the economy slow. The unemployment rate, currently at 4.2 per cent, could peak at 4.5 per cent, according to the report.
Australia boosted its annual migration numbers in 2022 to help businesses recruit staff after the pandemic brought strict border controls and kept new foreign students and workers out for nearly two years. The record migration — driven by students from India, China and the Philippines — expanded labour supply but worsened an already tight housing market.
Last month, in an attempt to contain the surge in migration, the government more than doubled the visa fee for foreign students and pledged to close loopholes in rules that allowed them to continuously extend their stay.
International education is one of Australia’s largest export industries and was worth A$36.4 billion (£18.6 billion) to the economy in the 2022-2023 financial year.
Last week business and tourism groups wrote to the Albanese government, warning that cuts to student numbers would drive the economy into recession. “This proposal presents an immediate, and we believe unacceptable, risk to our broader economy at a time when we already walk a narrow road between growth and recession,” their letter said.