Are you feeling rich?
Maybe you should be as not only did household wealth hit record highs at the end of 2021, the lift in wealth in the quarter was the biggest recorded in 11 years.
According to the Australian Bureau of Statistics (ABS), household wealth skyrocketed by $501 billion in the last three months of last year, to be up 7.0 per cent on a year ago.
It was the strongest quarterly gain in wealth in 11 years.
The average wealth per person rose by $19,028 in the December quarter ro hit $467,709, and total household wealth hit $12 trillion — both records.
No wonder that people are feeling more confident and spending.
Despite the pain of the lockdowns, and nearly a million jobs disappearing, by the end of 2020 Australia's household wealth was surging.
Clearly the recession was great for some Australians.
What's going on?
Well.. a lot has to do with owning real estate.
When the ABS compiles its data on wealth and income, "wealth" refers to the economic resources held by members of a household after all of their debts are theoretically paid off.
Wealth is made up of:
- Residential property (family home)
- Superannuation savings
- Shares and other financial assets (like bank deposits)
- Other non-financial assets (cars, furniture, artwork)
- Investments in other real estate (investment properties)
What's happened here is that booming property prices have pushed Australia's household wealth to record levels, despite hundreds of thousands of people remaining unemployed.
It followed an increase in property values of more than $200 billion in the September quarter.
We're also stashing our cash
There is cash everywhere, not just from government stimulus packages.
Aussies stashed the cash, being concerned that we could have a prolonged recession, but now that this hasn't occurred many consumers are back to spending.
Households held a record $1,322.6 billion in cash and deposits at the end of December. Cash and deposit holdings represented 21.6 per cent of financial assets.
The share of cash and deposits stands near the 21.5 per cent average since the global financial crisis and long-run average of 21.4 per cent.
Now is the time to take advantage of the opportunities the current property markets are offering.
Sure the markets are moving forward, but not all properties are going to increase in value at the same rate. And some sectors of the market will continue to languish.
Now, more than ever, correct property selection will be critical.
You can trust the team at Metropole to provide you with direction, guidance and results.
Whether you’re a beginner or an experienced investor, at times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that's what you exactly what you get from the multi award winning team at Metropole.
We help our clients grow, protect and pass on their wealth through a range of services including:
- Strategic property advice. – Allow us to build a Strategic Property Plan for you and your family. Planning is bringing the future into the present so you can do something about it now! Click here to learn more
- Buyer’s agency – As Australia’s most trusted buyers’ agents we’ve been involved in over $4Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney and Brisbane bring you years of experience and perspective – that’s something money just can’t buy. We’ll help you find your next home or an investment grade property. Click here to learn how we can help you.
- Wealth Advisory – We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
- Property Management – Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.