Residential property makes Aussies richer than ever

As we enter a calmer real estate market after 30% plus growth in values over the past two years, it’s interesting to see property hailed as the top reason for increasing our household wealth.

According to the Australian Bureau of Statistics (ABS), individual wealth stands at a record $574,807. Residential property had contributed 1.4% to the growth, which meant wealth fell away in other areas.

The nation’s household wealth increased $173 billion (1.2%) in the March quarter, reaching a record $14.9 trillion.

While small falls in value were registered in Sydney and Melbourne in the March quarter, the other capital cities and regional areas contributed to a 1.9% rise in property value.

The ABS said that since the March quarter in 2020, household wealth had increased 35.3 per cent, “driven by asset prices appreciating”.

Individual wealth had increased by $146,008 since the start of the pandemic, and households had now accumulated $305 billion in currency and deposits.

Residential property accounted for most household wealth growth, rising 39.9% as an asset class during the 12 months to the end of March.

Superannuation balances increased 22.5% over the same period “as share markets were supported by accommodative monetary policy”, the ABS stated. Currency and deposits contributed 0.2% to the growth.

The ABS also found that superannuation balances declined 1.3% during the latest March quarter, blaming “heightened uncertainty in global share markets”.

NOTE: The information in this article is general in nature and provided as a general overview  only. Always consult your financial advisor or accountant for advice specific to your personal circumstances.