The changes to 457 visas could result in a decrease in demand for housing in Australia by 10 % according to the survey of the UBS investment bank. In fact, it has been estimated that if the approval of student visas is decreased by one-third, the decrease in demand for housing could fall as much as 30%.
The analyst team of the UBS investment bank George Tharenou, James Druce, and Grant McCasker said that many industry resources have been surveyed to study the impact of the changes to 457 visas. Based on their feedback from the surveys, the data were analyzed to study the impact of the changes to the 457 visas.
The analysts further added that the threats of 457 visa changes to the housing market are quite apparent. The effects of these changes are currently being under evaluated by the housing markets, added the analysts.
Matthew Gross of the National Property Research Company said that net immigration is one of the crucial propellants of the real estate market. He is also Reserve Bank of Australia’s business liaison for real estate, as quoted by the AFR.
Mr. Gross added that by reducing the number of immigrants, a situation will be created where in end users are less and the products are more. Thus the products will slow down in the absence of end users. It is similar to mining towns where asset prices declined and vacancy rates increased owing to the exit of miners.
Mr. Gross further explained that in the case of absence of increased immigration levels in Australia that was present in the last 4-5 years, the property market would have been much worse off.
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