House prices drove household wealth to record high

Media Release

Total household wealth increased 4.5 per cent ($628b) in the December quarter 2021, reaching a record $14,677b, while wealth per capita rose to a record high of $566,541, according to figures released today by the Australian Bureau of Statistics (ABS).

Head of Finance and Wealth at the ABS, Katherine Keenan said: “Residential property prices continued to drive increases in household wealth, contributing 3.5 percentage points to the quarterly growth in household wealth. Prices increased 4.7 per cent during the quarter, reflecting record low interest rates, labour market recovery, and strong demand for housing.”

Ms Keenan said increases in superannuation balances, and currency and deposits, contributed a further 0.7 and 0.3 percentage points respectively. Offsetting these was an increase in household loans which detracted 0.4 percentage points from growth.

"The contribution of superannuation to household wealth reflected the recovery in the labour market, as well as the increase of the superannuation guarantee from 9.5 to 10 per cent from 1 July 2021.  Household deposits continued to grow, although at a slower rate compared to September quarter, as household spending increased as states emerged from COVID-19 lockdowns.“

Demand for Credit

Current prices, original

Total demand for credit was $123.2b, led by households, ($54.4b) and private non-financial business, ($37.0b). Household demand for credit was the strongest on record, surpassing the previous record set in June 2007, ($52.8b).

”Household loan borrowing reflected increased levels of activity in the property market and short-term borrowings of $1.7b reflected a pickup in consumer spending in the December quarter,“ Ms Keenan said.

Authorised deposit taking institutions continued to return to offshore commercial funding markets to manage liquidity requirements following the cessation of the Term Funding Facility in June 2021. This was reflected by a sharp increase of $35.0b (27.9%) in short term debt and $1.9b (0.7%) of bonds issued offshore.

Media notes

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