A booming property market has helped add another half a trillion dollars to Australia’s household wealth, taking the total to just over $12 trillion.
The nation recorded its biggest gain in quarterly wealth since 2009 despite COVID-19 concerns and employment fears when JobKeeper ends.
According to the ABS, total household wealth increased 4.3%, or $502 billion, in the last three months of 2020, marking the highest quarterly growth rate since the December Quarter of 2009.
The property market was the key driver. During the December Quarter, residential assets grew by $246 billion, or 3.5%, the biggest rise since the December Quarter of 2016. That came on top of a $200 billion rise in house values for the September Quarter.
ABS head of finance and wealth Katherine Keenan says: “The growth in residential assets was seen across both owner-occupier and investor housing in the December Quarter. Owner-occupier housing loans grew 1.9%, the strongest growth in four years, while investor housing loans grew 0.4%, which was the first positive growth in the past two years.”
The housing debt to income ratio decreased from 139.2 to 139 over the quarter, as growth in income exceeded growth in housing debt. The ratio has fallen for the past four quarters.