Your Anger is Being Routed

In Australian property, the foreign buyer, migrant, and boomer takes are partially right. None can actually fix the problem.

Three positions dominate the Australian housing conversation, and each one has a different villain. Foreign buyers. Migrants. Boomers. The frames disagree on the cause but they agree on the structure. Someone else is to blame, and the solution is to punish that someone. The argument has been running in roughly this shape for ten years and prices have gone in one direction.

I run a firm that serves owner-builders across Australia. We get projects in every state. We see what people are trying to build, what they can afford to build, and what the system permits them to build. I also live in Melbourne’s northern suburbs, where the houses go up faster than the infrastructure that’s meant to support them. So the housing question is not abstract for me. It’s the texture of what I do for a living and where I’m raising my children.

I want to take each position seriously before saying what it gets wrong. Each one contains a real observation that others would rather ignore. None of them is sufficient on its own. The way the argument is currently shaped lets the actual drivers stay out of view, which is convenient for the people benefiting from the status quo.

Lets start with foreign buyers. The strongest version of this argument: between roughly 2010 and 2017, a wave of capital from mainland China bought into inner Melbourne, Sydney, and southeast Queensland markets, often through off-the-plan apartments, and pushed prices up in those specific corridors. Enforcement by the Foreign Investment Review Board was weak and easily structured around using Australian residents and family trusts. The argument is real, in those windows, in those locations.

I have direct experience of that period. I spent part of it inside a mid-size Melbourne construction company that did relatively few houses for domestic clients. The bulk of the work, and most of the margin, came through a separately branded entity targeting foreign investors, mostly from mainland China. The product consisted of low-spec dog boxes. The same pattern showed up at some of the largest builders in the country I worked with: a domestic brand for the public-facing side of the business, and a different brand for the offshore-targeted side, where the volume actually was. The foreign-buyer wave wasn’t a rumour. It was the business model.

But it stopped being the main story years ago. The 2017 federal reforms tightened the rules,¹ mainland capital controls clamped down on outflows, and stamp duty surcharges in NSW and Victoria made foreign buyers a smaller share of the market every year since. By 2024, foreign residential investment had fallen to $1.3 billion in approvals, with mainland Chinese buyers contributing $0.4 billion.² Prices kept rising anyway. If foreign buyers were the cause, the cause has been substantially removed and the symptom has gotten worse. That is not how causation works.

The framing of this argument also picks a target with no political voice. Foreign buyers don’t vote here. They’re easy to point at and impossible to retaliate against politically. That is convenient for politicians, which is most of why the foreign-buyer story persists past its usefulness as an explanation.

The next position is migration, and this one is harder to discuss honestly. The strongest version of the argument is numbers, not values. Net overseas migration peaked at 538,000 in the 2022-23 financial year, the highest annual figure on record.³ You cannot add the population of Canberra to a country with a chronic supply problem and pretend it doesn’t affect rents and prices. Believing otherwise requires you to disbelieve basic math, and your calculator is not the one with the agenda.

The reason it’s hard to discuss is that the argument has been thoroughly weaponised. Anyone who’s seen One Nation’s talking points on this knows exactly where the frustration lives. It’s real. Their version of the debate is about who ‘belongs’ and frames cultural change as a crisis. That isn’t where I’m going with this. But the actual numbers involved are real. If we ignore the data simply because we don’t like the people talking about it, we leave the door wide open for the loudest voices to define reality for the rest of us.

We live on a big island with a giant moat around us. Nobody arrives here by accident. Every person holds a visa issued by a government decision. Which means migration is a policy lever, not a force of nature. Both major parties have run high-migration programs since the late 1990s. Business lobbies have fought every attempt to reduce it. Universities have built revenue models on international student numbers. Federal treasury models it as growth. Migrants themselves don’t decide how many come. The government decides, and the government is not migrants. The frustration is legitimate. The target is wrong.

There is a less spoken about point worth making here. Migrants get blamed for housing pressure while owning roughly none of the political-financial system that creates it. They didn’t write the negative gearing rules. They don’t sit on planning panels. They are a downstream consequence of decisions made by people who already had houses.

The third position is the baby boomers. The strongest version of this argument: An older generation bought houses at four or five times their income, voted consistently to protect tax settings that drove prices to between eight and fourteen times their children’s income depending on the city,⁴ and now treats property as a retirement asset rather than housing. Negative gearing, the 50% capital gains tax discount, and franking credits all benefit existing property owners. The 2019 federal election, when Labor proposed reforming negative gearing and lost, was a generation telling the next one no.

This argument is mostly right. Older Australians as a voting bloc have protected a system that benefits them at the expense of their kids and grandchildren. That’s not slander. That’s the data.

There is a harder question buried inside this, and I don’t have a clean answer to it. Individual boomers didn’t write the rules. They also voted to keep them when given a clear chance, 2019 being the most obvious. At some point, continuous democratic ratification stops being inheritance and becomes ownership. I don’t know exactly where that line sits. But it sits somewhere, and skipping the question is not the same as answering it.

That said, the personalisation still goes wrong in the obvious place. The Hawke government quarantined negative gearing for property losses in 1985 and the Keating-era reversal restored it in 1987.⁵ Howard halved capital gains tax in 1999. The Reserve Bank dropped the cash rate from 17.5% in 1990 to 0.10% in 2020.⁶ The settings are political, written by people in their 50s and 60s for people in their 50s and 60s. Destroying strangers in Facebook comments might give you a nice dopamine hit, but it doesn’t rewrite a single line of policy.

The boomer argument also has the same problem the foreign-buyer argument has. It picks a target you can be angry at without inconveniencing the people who actually pull the levers.

So three narratives, each one partially right, each one pointing at a target without the power to fix what it’s being blamed for. People who came here. People who got old. People who got rich overseas. Two of them have no political power. One has political power but didn’t design what it’s being blamed for. The actual structure of the problem sits somewhere else entirely.

Australian housing is held in its current shape by a coalition that almost never gets named in the tribal arguments. The most important member is the banking system.

Australia has more residential mortgage exposure than any comparable country, and the Big Four control roughly 70% of new owner-occupier lending and 77% of investor lending.⁷ Their balance sheets are not just exposed to housing. They are housing, in a meaningful sense. A 15% fall in dwelling values wouldn’t just sting borrowers. It would compress bank capital ratios, balloon impairment provisions, throttle dividends, and trigger credit tightening that slams the broader economy. The banks don’t need to lobby against housing reform. They just need to keep existing at their current scale. Any government considering reform that meaningfully drops prices has to weigh the financial-stability cost against the political benefit. So far that calculation has gone the same way every time.

Industry super funds are quieter but they’re in the same camp, particularly the larger ones with significant unlisted property allocations. Member returns are tied to those valuations holding up. Super funds don’t argue against affordability in the abstract. They argue against any specific change that would affect what’s in their portfolios, and they’re at every Treasury consultation, every productivity inquiry, every state planning review.

Then there are the developers, whose business model depends on planning scarcity. Property investors, including a fair chunk of the political class itself, who own multiple properties and write the rules. State and council planning systems too fragmented to coordinate supply at the scale required. Victoria alone has 79 councils,⁸ each with its own planning approach, each able to slow the process for political reasons. And a federal political class for whom housing reform is the third rail, because the 2019 election demonstrated the cost.

The arrangement is concrete in how it operates. Each member has a specific lever it has reason to block. Banks resist macroprudential settings that would meaningfully slow mortgage growth, and resist anything that risks a sharp price correction. Developers oppose zoning and density reform that would expand land supply and dilute their planning-scarcity rents. Property investors resist any change to negative gearing or the CGT discount. Super funds defend settings that protect their property allocations. Councils slow approvals because that’s what their incentives reward. The political class avoids tax reform because the 2019 election told them what voters do when asked. They also avoid the family-home exemption from the pension assets test, which keeps large dwellings tied up in single-occupant or empty-nest households long after they’ve stopped functioning as family homes — because reform of the assets test is one of the few things that has reliably ended political careers. Each group blocks a different lever. Everything that needs to move has someone organised against it moving.

When the conversation is about foreign buyers or migrants or boomers, this coalition is invisible. That is not accidental. Every minute spent arguing about a powerless target is a minute the actual structure goes unexamined. Someone benefits from this argument shape. It is not the renter, and it is not the young family in the western suburbs trying to work out how to buy.

The question I keep coming back to is where the actual lever sits, and what pulling it looks like. It sits in two places. Tax settings, which are federal: negative gearing, the capital gains tax discount, franking credits as they touch property. And planning systems, which are state and local: zoning, council consolidation, infrastructure-led density. Both are politically expensive. Neither involves blaming people without political voice. Both have been studied for years. Neither has moved.

There is something I should add before I finish up. Next week’s federal budget is heavily signalled to include changes to negative gearing and the capital gains tax discount, possibly with broader changes to family trusts.⁹ If it actually delivers, and the details survive the political process, part of this article’s argument about political will is wrong. I would be glad to be wrong about that. But two things first. The signalling has been heavy before and produced cosmetic gestures. And even if the tax settings move, the planning side is still a state and local mess that no federal budget can fix. The structural argument about who maintains the current shape stays intact regardless of what happens on budget night.

The owner-builders who come to my business are not flipping property. They are putting a roof over their families because they cannot afford a builder. The system makes that harder at every step. Permit timelines are long. Materials are up. Labour is up. Financing is the hardest it has been in twenty years. None of those things is caused by a migrant, a boomer, or a foreign buyer. They are caused by a system designed by, and for, people who already own.

If you want my position, here it is.

Foreign buyers were a real factor for a time, but they are not the story now. Migration is a legitimate variable, yet treating it as the headline cause is dishonest. Boomers, acting as a voting bloc, have defended policy settings that hurt their own children — but personalising the blame at individual grandparents is lazy until you first ask when a vote becomes a conscious choice.
The coalition that actually keeps this system in place stays invisible for one simple reason: as long as the fight is about foreigners, migrants, or boomers, the real architects remain untouched.

I could be wrong about the precise weights. I am not wrong about the shape.

1. Australian Government, May 2017 Budget foreign investment package. Measures included an annual vacancy fee, reduced capital gains tax exemptions for foreign residents, and higher application fees. See foreigninvestment.gov.au for the current framework.

2. Foreign Investment Review Board approvals data, summarised in API Magazine, “Foreign investment in Australian property tanking” (February 2025). apimagazine.com.au.

3. Australian Bureau of Statistics, “Overseas Migration, 2022-23 financial year.” NOM peaked at 538,000 in 2022-23 (year ending 30 June) and 556,000 in the year ending September 2023. abs.gov.au.

4. Demographia International Housing Affordability 2025 puts Sydney at a median multiple of 13.8x, with Melbourne, Brisbane, and Adelaide also above 9x. Money.com.au’s 50-year analysis shows Brisbane moved from roughly 4x in 1975 to 11x today, with Sydney following a similar trajectory. See Morningstar Australia summary and Real Estate Business coverage.

5. The Hawke government quarantined negative gearing for property losses against other income in 1985. The change was reversed in 1987 under Treasurer Keating, restoring full deductibility. Treasury and Parliamentary Library briefings cover the history.

6. Reserve Bank of Australia, Cash Rate Target historical data. Peak of 17.5% reached January 1990, low of 0.10% reached November 2020. rba.gov.au/statistics/cash-rate.

7. APRA Chair John Lonsdale (July 2025): the Australian banking system “has more exposure to residential mortgages than any comparable country.” Big Four share of new lending was approximately 72% of owner-occupier and 77% of investor loans in October 2025. See apra.gov.au and Savvy summary of APRA data.

8. Local Government Victoria lists 79 councils across the state. localgovernment.vic.gov.au.

9. CommBank 2026 Federal Budget Preview (April 2026): expects the budget to include a return to CGT indexation across all asset classes (replacing the flat 50% discount) and the abolition of negative gearing for new investments, with grandfathering for existing investors. The Treasurer has not publicly committed to a specific model at the time of writing. See commbank.com.au budget preview and the Senate Select Committee on the CGT discount (March 2026 report).