Student slump steering softer population profile in Australia

• While recent data has come in close to guidance, with net overseas migration (NOM) estimated to total 485,000 for FY2024, the near-term outlook for overseas migration has softened.

• Although a slowdown is evident across most key visa streams, international students dominate and are where the largest fallback resides. Student visas granted to offshore applications were down 43% y/y to 60,803 in June quarter.

• Policy moves are dragging with some yet to impact. Student visa fees were more than doubled in July and a student cap looms from the start of the 2025 academic year. It is stressed that the slump reflects a shift back to trend. While there are areas of acute challenge, the international student market remains fundamentally sound overall.

• We forecast NOM will roughly halve to 245,000 in FY2025 and slide further to 210,000 in FY2026. It is now not until FY2028 that we expect to return to a steady state level of 250,000 per annum. In total population terms, it is projected this will slow Australia’s growth rate to 1.15% by FY2026.

• A rising volume of temporary visas are expiring. Combined with stricter rollover requirements such as the newly introduced Genuine Student Test (flagged in last year’s Migration Strategy), an increasing pool of temporary visa holders are in limbo. The bridging visa queue has once again blown out, and it remains unclear how the Federal Government plans to triage this.

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