The Office for National Statistics (ONS) released its Migration Statistics to June 2015, with preliminary estimates showing which estimated Long Term International Migration hitting a record inflow of 336,000. The figures for the year to March 2015 were revised up to 336,000 too.
The latest data represents a massive increase of 32 percent or 82,000 from the revised figures to June 2014. It's also a shocker for givernment targets, which aim to have immigration down to below 100,000 by 2020.
Why and where from?
There was an increase in the net migration both from the EU (+42,000 to +180,000) and from outside it (+36,000 to +201,000).
If you've been to Britain lately you won't be surprised to hear that there has been a huge lift in immigration from Eastern Europe, the latest figures showing 50,000 immigrants from Romania and Bulgaria alone in the year to June, 84 per cent of whom arrived for work-related reasons.
Indeed, according to the ONS most immigrants came to the UK for work-related reasons (294,000), with two thirds of those having a "definite job".
While 336,000 might not sound like a catastrophically high number for net immigration, it needs to be remembered that unlike Australia, Britain is only a small place!
Moreover, Britain is already struggling with internal demographic shifts towards London and the South East of England, a chronic housing shortage in that part of the country, twinned with diabolical traffic congestion (do a Google image search for "M25" and you'll get the gist).
The net immigration figures alone don't provide much texture, but other data released by the government today tells you most of what you need to know about where immigration is focussed.
National Insurance numbers issued to overseas nationals in the year to September 2015 - a requirement for those seeking legal employment in Britain - showed that well over half a million allocations were issued for London (40 per cent), the South East (12 per cent) and the East of England (8 per cent).
By contrast Wales (2 per cent), the North East (1 per cent) and Northern Ireland (1 per cent) attracted very few allocations.
This is a challenge which is set to face Australia too in the decade ahead, with projections showing that net immigration will become even more focussed on four capital cities plus south-east Queensland.
As cities mature this dynamic can become self-sustaining as immigration creates the requirement for new infrastructure, retail outlets and dwellings, an in turn, more employment. Last year I wrote about Zipf's Law and the distribution of population across cities here.
The Tinkerman strikes again (circus)
None of the above will do much for the housing crisis in London and the South East, of course, but fear not, for the "Tinkerman" Osborne has got plans up his sleeve! Including these:
(1) Following on from the announcement of a buy-to-let tax grab earlier in 2015, the latest wheezes announced in the spending review include a 3 per cent SDLT hike for landlord purchasers (the UK doesn't have the word "rort", but it will probably need it after this, as owner-occupiers suddenly decide to consider becoming landlords immediately after settlement).
While this will win applause from some sectors, the likely outcomes will be another punishing squeeze on London rents, and a surge of buyers rushing madly to "get in" before the April deadline. After April, there will then be a sharp decline in Buy-to-Let purchases, a reversal in the sector, and probably further rent rises;
(2) Osborne also announced plans to build 400,000 new homes, which is laudable, though there will be a 20 per cent discount on 200,000 starter homes for first time buyers under 40 (inflationary, and keeps new home prices artificially high);
(3) Restrictions on Help to Buy Shared Ownership will be removed effective April (oh yes, inflationary);
(4) Right to Buy extended to Housing Association tenants; and
(5) The Chancellor also announced a Help to Buy scheme for London in the Autumn spending review (in tandem with recent stamp duty tweaks, inflationary for the lower price brackets, particularly on new builds). This will be a new equity loan scheme which will allow buyers to borrow up to 40 per cent* of the value of London borough homes up the value of £600,000).
Strewth, what a circus! Net result in my best estimate: yet higher house prices for London (particularly sub £600k), declines in the buy-to-let sector elsewhere, and probably rising rents.
*The previous Help to Buy rules allowed buyers to borrow 20 per cent of the home value, but loans for homes in London boroughs or the City of London will be "twice as generous" at 40 per cent, and will come with a five year interest free period. Should go well. Or not.