Household wealth continues to surge

Total household wealth increased 4.3 per cent ($518.0b) in the March quarter 2021 to reach a record $12,664.5b, according to figures released today by the Australian Bureau of Statistics (ABS).

Wealth per capita also rose to a record high of $492,055.

Head of Finance and Wealth at the ABS, Katherine Keenan said: “Residential assets contributed 3.5 percentage points to the quarterly growth in household wealth, followed by superannuation balances and directly held shares, at 0.6 and 0.2 percentage points.

“Growth in household wealth continued to be driven by rising residential property prices, reflecting record low interest rates, support through a range of government incentives and recovery in the labour market.”

Through the year, household wealth grew 15.3 per cent, which is strongest through the year growth since March 2010 (22.6 per cent). Residential assets rose 13.9 per cent ($968.2b) through the year with property prices contributing 8.5 percentage points to the growth and superannuation balances 4.1 percentage points.

Ms Keenan added: “Household wealth grew more in the last year than it did during the preceding three years combined. Over the three years prior to March 2020, household wealth grew 11.4 per cent.”

The deposit assets of banks increased to an unprecedented $304.5 billion, as the Reserve Bank of Australia injected further liquidity into the financial system in line with current monetary policy goals. The liquidity helped the growth in bank loans to households (3.8 percent) and the resumption of bank loan borrowing by private non-financial corporations (0.7 per cent) following three quarters of repayments when private non-financial corporations repaid more than they borrowed.