Key takeaways
Australia is facing unprecedented population growth, largely driven by migration, yet we're failing to plan adequately.
The current approach of managing housing, infrastructure, and population growth separately is reactive, fragmented, and ultimately ineffective.
This lack of coordination results in escalating housing prices, overstretched infrastructure, and increasing social tension.
Australia is undergoing rapid population growth but the way we’re planning for it (or rather, not planning for it) is setting us up for failure.
We’re adding hundreds of thousands of new residents every year, mostly through migration.
But our governments are still managing housing, infrastructure, and population growth in separate silos.
There’s no overarching plan to tie it all together.
No compass.
No coordination.
No national demographic strategy.
Instead, we’re reacting, not leading.
And the consequences are showing up everywhere—from skyrocketing housing costs to overstretched roads, schools, and hospitals.
If we want to build a prosperous, inclusive, and future-proofed Australia, we need to do what other smart nations are starting to do: think long-term, holistically, and strategically.
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Australia’s policy vacuum: growth without a plan
Let’s call it for what it is: we’re making big national decisions without thinking through their second-and third-order effects.
We welcome record numbers of migrants—essential to our economy, our tax base, and our global competitiveness—but we don’t match that with housing targets, infrastructure funding, or workforce planning.
As Simon Kuestenmacher rightly said in our recent Demographics Decoded podcast, “Australia has around 20 years’ worth of infrastructure backlog.”
That’s two decades where we’ve underinvested in the very things a growing population needs.
The housing crisis, for example, didn’t appear out of nowhere. It’s a predictable result of:
- Rapid population growth
- Stagnant housing construction
- Labour and materials shortages
- Political reluctance to tackle supply-side constraints
Meanwhile, we treat migration as a political football, not a sophisticated lever to manage long-term demographic risks.
This lack of coordination is what makes migration such a divisive issue because people feel the growing pains, but they don’t see the plan.
What should a national demographic strategy look like?
Simon argues (and I agree) that we need a coordinated national strategy with clear targets to guide population policy across key domains like housing, infrastructure, workforce, and public services.
Some key pillars of this strategy should include:
1. A targeted dependency ratio
As our population ages, we need a healthy ratio of working-age Australians to retirees.
Otherwise, the tax burden on younger generations becomes overwhelming.
Migration plays a key role in keeping that ratio in check, but it has to be the right kind of migration.
We should prioritise young, skilled workers who can contribute to the workforce for decades.
This isn’t just a social issue.
It’s a fiscal one.
Without enough taxpayers, how do we fund pensions, healthcare, and aged care for an ageing population?
And if we don’t target younger, economically active migrants now, we risk inflating the millennial generation—our current economic engine—into a future aged care liability.
That’s a demographic time bomb.
2. A rational migration program
Migration is not just about numbers; it’s about composition.
Right now, we’re bringing in too many highly qualified migrants only to underutilise them.
Think engineers driving Ubers or PhDs stacking shelves.
That’s not just a waste of talent, it’s an economic failure.
Simon proposes more employer-sponsored visas to align skilled migrants with actual labour shortages.
That would mean more accountability, better job matching, and less waste in our skilled migration program.
But we also need to be age-conscious.
Highly trained professionals (like doctors) may be older, and that’s fine, but other migrants, in hospitality or construction, should skew younger where possible.
Strategic migration isn’t about closing borders.
It’s about smarter choices that balance our economic needs with long-term demographic sustainability.
3. Housing affordability as a policy anchor
Right now, Australia is one of the most unaffordable housing markets in the developed world.
Demographia classifies any market where the median house price is more than five times the median income as "severely unaffordable."
Well, welcome to Australia.
In Sydney, that ratio is 13–14.
Even in our “affordable” cities, it’s 7–8.
Nationally, we’re around 8.5 times income.
A national demographic strategy could include an affordability target—say, five times the median income.
- Also read:Everything you need to know about the state of Australia’s property markets in 20 charts – April 2025
- Also read:Sydney property market forecast for 2025. Is it a good time to invest in Sydney?
- Also read:Brisbane Property Market Forecast [2025] – What’s Ahead & Where to Invest
- Also read:Melbourne property market forecast for 2025 | Is it a good time to invest in Melbourne?
- Also read:Latest property price forecasts for 2025 revealed. What’s ahead in our housing markets in the next year or two?
We won’t hit that overnight, but with the right mix of planning reform, supply stimulus, downsizing incentives, and land release, we could trend in that direction over 20–25 years.
And if that sounds familiar, it should.
We already manage inflation through the RBA with a 2–3% target.
Why not do the same for housing affordability?
4. Set public housing targets
Currently, only around 4% of Australia’s housing stock is public or social housing.
That’s simply not enough.
Simon proposes increasing it to 10% as a minimum, still below many European countries, but a massive improvement on today.
Public housing acts as a stabiliser.
It supports the most vulnerable and relieves pressure on the private rental market.
And here’s a smart long-term view: once public housing is built and the mortgage is paid off, it becomes one of the cheapest assets for the government to maintain.
It delivers housing security at a fraction of the cost of the aged pension or private rental subsidies.
Yet, we’ve sold off far too much of our public housing stock, especially in prime urban locations, without replacing it.
That’s short-sighted, and it’s hurting us today.
Stop blaming students—start building solutions
Let’s also tackle a myth head-on: international students are not the cause of our housing crisis.
They tend to live in purpose-built student accommodation (PBSA) or share houses near universities—not in family homes in the suburbs.
Yes, they do consume construction resources.
But, they spend money on rent and groceries and a range of goods, and they help our economy go around.
And the idea that cutting student numbers will free up suburban homes is false.
Blaming non-voting foreigners is easy politics.
It avoids confronting the real structural issues: restrictive zoning, underbuilt supply, and years of political inertia.
We’ve done this before—we can do it again
Simon made a powerful point: Australians have already proven that we can accept short-term sacrifice for long-term gain.
We did it during COVID.
We’ve done it before with Medicare, superannuation, and even the GST.
We just need leaders with the courage to think longer than the next election.
Yes, our political system works in three-year cycles.
But we can and should pursue multi-decade reforms, especially if the alternative is kicking the can down the road until it's too late.
Other countries like Switzerland are already developing national demographic strategies.
Why not us?
A national strategy isn’t a luxury—it’s a necessity
Let me be blunt: Australia can’t afford to keep managing housing, migration, and infrastructure in silos.
Without coordination, we’re just setting ourselves up for more social tension, worsening inequality, and economic underperformance.
A national demographic strategy isn’t a utopian dream.
It’s a practical necessity.
It would help us:
- Match infrastructure with actual population forecasts
- Balance housing supply with demand
- Set and meet housing affordability benchmarks
- Align skilled migration with labour shortages
- Build public trust in a more inclusive, transparent population policy
And critically, it would ensure that future generations—our kids and grandkids—aren’t priced out of opportunity.
Final thought: long-term policy is the new political capital
If Australia’s major parties don’t step up, they risk becoming irrelevant.
Young Australians aren’t voting the way they used to and if their economic and housing futures remain grim, they’ll either check out of politics entirely or turn to the fringes.
But there’s a better path.
Be bold.
Build vision.
Explain the trade-offs.
Start the process of long-term change now, even if the results won’t show for decades.
We’ve done it before.
It’s time we did it again.
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