Household wealth rose for the fifth straight quarter (+2.8 per cent or $419 billion) in the December quarter of 2023, according to the latest figures released by the Australian Bureau of Statistics (ABS).
Total household wealth was $15.7 trillion in the December quarter, which was 7.8 per cent ($1.1 trillion) higher than a year ago.
Residential land and dwellings were the largest drivers of the rise, contributing 1.2 percentage points to quarterly growth in household wealth.
Dr Mish Tan, ABS head of finance statistics, said:
“Household wealth saw a large boost from rising values of assets this quarter.
House prices continued to grow significantly, as did domestic and overseas share markets.”
Share market growth over the December quarter drove superannuation assets to increase 3.9 per cent ($140.1 billion) and households’ direct ownership of shares and other equity to increase 3.8 per cent ($51.8 billion).
This contributed a combined 1.3 percentage points to quarterly growth in household wealth.
Meanwhile, the total demand for credit was $105.1 billion in the December quarter, the strongest demand since the September quarter of 2022.
This was driven by households ($33.2 billion), private non-financial businesses ($29.2 billion), the Commonwealth government ($17.7 billion), and state and local general government ($16.5 billion).
“Household borrowing reflected continuing demand for housing amid strong population growth.
A seasonal boost from spring housing market sales also drove household borrowing in the December quarter,” Dr Tan said.
Treasury bonds issued during the quarter helped fund Commonwealth government investment in infrastructure and other policy priorities.
Other key figures from ABS:
Non-financial assets
Non-financial assets owned by households increased by 2.0% ($225.0b), driven by:
- $188.5b rise in residential land and dwellings.
House prices continued to increase despite rising interest rates, as supply is still unable to meet current demand.
Financial assets
Financial assets of households increased by 3.3% ($231.6b), with a:
- $140.1b rise in superannuation reserves
- $51.8b rise in shares and other equity
- $32.7b rise in currency and deposits
Total superannuation reserves increased by 3.9% this quarter, driven by favourable domestic and international share market performance increasing the value of equities held by superannuation funds.
Total deposits increased by 2.0%. Transferable deposit account balances rose $15.3b, including offset accounts which rose $8.9b.
Other deposit accounts (which include term deposits and savings accounts) rose $17.0b.
Liabilities
Household liabilities increased by 1.2% ($37.4b), with a:
- $26.6b rise in housing loans
- $0.7b rise in short-term loans
The growth in housing loans was driven by both owner-occupied ($21.2b) and investor ($5.5b) loans.
The increase in short-term loans was due to seasonal year-end spending.
Through the year, short-term loans fell 1.4%, reflecting a decline in household preferences for acquiring short-term debt.
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