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New findings from the Australian Bureau of Statistics (ABS) reveal that household wealth in Australia rose by 0.8 percent during the March quarter, bringing total assets owned by Australians to $17.3 trillion. This growth is primarily attributed to the appreciating value of residential land and buildings, which climbed by 1.2 percent, equal to an increase of $125.3 billion.

Where did wealth fall?

The ABS data showed superannuation assets fell 0.4 per cent, or $16.4 billion, in the March quarter, something experts attributed to market uncertainty.

The interest rate cut in February, marking the first reduction since November 2020, benefitted not only those with existing mortgages but also increased property asset values for homeowners. According to AMP’s chief economist Shane Oliver, “The Australian housing market began reacting to February’s rate cut positively. Despite a slow January, house prices are once again on the rise.” He noted, “This trend favors those who already own houses and land, but poses challenges for potential buyers.”

“April turned out okay for the share market and then saw a rebound as Trump backed away and went onto a pause for the tariffs. But the damage was done through the March quarter as share markets fell in response to the tariffs,” Oliver said.

The ABS has reported a decline in household superannuation balances for the first time since the September quarter of 2022, a consequence of global market uncertainties affecting share prices. Mish Tan, ABS head of finance statistics, explained, “Typical superannuation funds invest around 60 to 70 percent in shares. Thus, fluctuations in share prices impact the returns on these funds.”

Wealth among the wealthiest growing ‘much faster’

While Australia might be getting richer, that wealth isn’t distributed equally.
According to 2024 statistics from the Australian Council of Social Service (ACOSS) and UNSW, the wealthiest 10 per cent of households in Australia own 44 per cent of all wealth, with an average of $5.2 million per household.
The average wealth of the richest 10 per cent of households was also growing “much faster” than the wealth of the lowest 60 per cent, ACOSS and UNSW found.

With the majority of Australia’s wealth in land and dwellings, it’s not surprising that wealth inequality manifests itself in housing — where a generational wealth divide has become more pronounced in recent decades.

The most recent ABS Census found 66 per cent of Australian households owned their own home — a figure that has remained roughly the same since the 1970s.
However, home-ownership rates among younger Australians have declined dramatically in that period.
According to the Australian Institute of Health and Welfare, the home ownership rate of 30–to-34-year-olds decreased from 64 per cent in 1971 to 50 per cent in 2021.

In that same span of time, the rates of home ownership among Australians aged 25–29 declined from 50 per cent to 36 per cent.

Housing prices set to continue rising

Oliver said he suspects wealth increases will continue.

“Right now, it looks like interest rates are heading lower, which will probably push up house prices and land prices further. So, I suspect that the housing component of residential wealth will see further gains through the remainder of the year,” he said.

“For the share market, it’s probably going to be a bit of a volatile ride … The noise around tariffs and the Middle East has led to a bit of roughness, but overall the trend has been up.”
“Interest rates coming down will probably also support shares and therefore support superannuation returns.”

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