Household wealth up 1.6 per cent in June quarter

Household wealth increased 1.6 per cent in the June quarter 2019 to a record high of $10,455.3 billion, following a 0.2 per cent rise in the previous quarter, according to figures released by the Australian Bureau of Statistics (ABS) today. The increase in household wealth was driven by real (inflation adjusted) holding gains on financial assets, partly offset by holding losses on residential real estate.

Chief Economist for the ABS, Bruce Hockman, said: "The share market continued to build on gains seen earlier in the year, boosting the value of household shares held directly and through their superannuation funds. Residential real estate has had six consecutive quarters of real holding losses but the losses this quarter were smaller than previous quarters."

Household wealth per person increased by $4,966 to $411,492 this quarter but remains below the record high of $416,389 per person set in the June quarter 2018. While household wealth grew 0.5 per cent through the year, this was largely driven by population growth of 1.7 per cent, with household wealth per person contracting 1.2 per cent through the year.

The numbers also show that Australia was a net lender to the rest of the world, lending $3.9 billion in the June quarter 2019. National saving exceeded national investment for the first time since the March quarter 1980, as the surplus of funds through Australia's financial system was mainly used to repay debts with non-residents.

Mr Hockman noted that "the boost to national saving from a record trade surplus this quarter has allowed Australia to fund investment internally. Private non-financial corporations used increased saving to repay loans with banks. Banks had slower growth in the size of their loan books so needed less short term funding in overseas markets."