Hi Lloyd Perry™, thanks for the comment. Migration is a big driver for housing demand, but houses are being built. Despite this, the population growth rate is currently falling (and has been for the past three years). In addition to this, new housing stock is currently sitting at around 220K per annum.

There’s no shortage of supply of housing, there’s actually an abundance. The problem is that the debt being taken out to purchase these houses is unsustainable.

In summary, your friend is right—population growth means more houses are needed, however, if those houses are supplied (supply meets demand), the price shouldn’t increase (at least not as dramatically as they have been). Hope that helps.