Contrary to mischievous reports of declining living standards, household net worth blazed past a record $9 trillion the September quarter to an fresh high of $9,061.7 billion.
Of course, people like to argue that we aren’t getting better off on a per capita basis, particularly those that don’t like immigration, like Dick Smith.
However, this is not backed up by the figures, as average net worth per capita also rose to an all-time high of $374,300.
Australia has the second highest net worth per adult in the world, behind, well, Switzerland.
What is true is that wealth is tilted in favour of property owners, with $4.2 trillion of household equity tied up in Australian residential land and dwellings.
Not that surprising given how poor returns from Australian shares have been over the past decade – if it wasn’t for compulsory superannuation the proportion of wealth held in equities would be even lower.
Note that the total value of residential land and dwellings is actually a little higher than implied by the chart at $6.1 trillion, but technically not all of these assets are owned by households.
A chart which will no doubt cheer Treasurer Morrison shows that the debt to assets ratio has declined to 20 per cent from the peak of 22.2 per cent in March 2009!
This quarter’s figures also showed a spike in gross household income growth, which helped to push the interest payable to income ratio down to below 10 per cent, which is about where it was before the Sydney Olympics all the way back in the year 2000.
A poor quarter for GDP growth, then, but household wealth surged to a record high of $9.1 trillion, so it’s hardly all bad out there.
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You might look at these figures and wonder whether they are fair, or whether net worth is being distributed fairly across all age ranges, genders, social groups, and so on.
I can save you a lot of time there, because the answers are ‘no and no’.
The answers will always be ‘no and no’.
However, if you’re brain is telling you that “it can’t be done” when it comes to building wealth, the numbers contradict you.
It clearly is being done, and has been for a long time!
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