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“It’s the single biggest thing that we can do immediately to address the housing crisis,” said Mike Moffatt, senior policy director at the Smart Prosperity Institute and a former economic adviser to Trudeau from 2013 to 2015. “We will first of all see easing pressure on the rental market. But what we’ll also see is an overnight investor say, you know what, the student market doesn’t look as attractive as it did.”

Miller’s announcement comes after months of pressure on Trudeau’s government to take stronger action against colleges that are believed to be exploiting foreign students, who are charged an average of five times as much as Canadians. Provinces and territories will be responsible for distributing the allocated permits among institutions, meaning they’ll face added incentive to prioritise high-quality schools.

Post-secondary institutions have increasingly relied on tuition fees as provincial funding as a share of revenue has declined from 42 per cent in 2001 to 35 per cent last year.

Ontario, Canada’s most populous province, has also frozen tuition fees that can be charged to Canadians for the past three years. In 2019 to 2020, foreigners paid 37 per cent of tuition at Canada’s universities, while in 2021 those students paid an estimated 68 per cent of tuition at Ontario’s colleges.

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Miller has already pledged a designated-institution framework that will prioritise visas for post-secondary schools that provide higher quality education and adequate supports, including housing, which would come into effect this fall. He has also doubled the financial requirements for new study permit applicants.

International education contributes more than C$22 billion ($24.8 billion) to the Canadian economy annually and supports more than 200,000 jobs, according to Miller’s office. But the influx of foreign students has aggravated housing shortages, leaving many without proper accommodation and fuelling a backlash against high immigration in the typically newcomer-friendly country.

“To be absolutely clear, these measures are not against individual international students,” Miller said. “They’re to ensure that as future students arrive in Canada, they receive the quality of education that they sign up for and the hope that they were provided in their home country.

“Allowing the bad actors to continue their operations would be a disservice to all the good institutions who pride themselves in providing a top-tier academic experience.”