Real estate has made Aussies $250 billion richer

Australian households are continuing to get wealthier, in spite of ongoing cost-of-living struggles, according to new data from the Australian Bureau of Statistics.

Over the June quarter, household wealth increased by 1.5 per cent. The figure may sound small, but this 1.5 per cent increase is equal to a $250 billion increase in wealth. 

This marks the seventh consecutive quarter that household wealth in Australia has risen, and according to ABS head of finance statistics Dr Mish Tan, house prices are responsible for most of this lift. 

“House prices have continued to rise across most states and territories, despite high interest rates,” Dr Tan said.

“This largely reflects ongoing housing supply constraints and an uptick in investor activity over the quarter.” 

As tight housing supply and investor activity has pushed up house prices, Australians who own property saw the value of their houses increase. 

Although Aussie homeowners may be asset-rich, many are still cash-poor. 

Over the June quarter, assets like shares and superannuation saw steady increases – but cash savings like currency and deposits fell by $9.2 billion. 

Rates of household savings remain incredibly low, with the average Aussie household currently saving just 0.6 per cent of their income – a sharp drop from the long term average of 5 per cent since 2000. 

And when it comes to spending, Australians are cutting back on discretionary spending like cafes and hotels, and increasing essential spending like energy bills, healthcare and rent.