Australians find silver lining in lockdowns as wealth explodes

SYDNEY, Sept. 23 (Reuters) – Australians find silver lining to lockups as super cheap credit pushes home and stock values ​​to record highs, a wealth windfall that empowers consumers to spend big an times the restrictions relaxed.

Figures from the Australian Bureau of Statistics released on Thursday showed household net wealth jumped by A $ 735 billion ($ 531.48 billion) in the June quarter to reach A $ 13.3 trillion, or 522 billion. 032 Australian dollars for each man, woman and child.

“Australian households have never been so wealthy,” said Ryan Felsman, senior economist at CommSec. “While wage growth remains subdued, asset values ​​are rising, supported mainly by record interest rates and government stimulus measures in the event of a pandemic.”

ABC economists estimate households accumulated A $ 230 billion in excess savings during the lockdown, giving them cash to spend on top of their assets.

The number one asset was easily real estate, with home values ​​rising by A $ 576 billion in the June quarter, as low mortgage rates and the shift to working from home pushed prices up.

Coronavirus closures in Sydney and Melbourne have only fueled this trend, with house prices rising sharply in those cities in July and August. Read more

Gains in the stock markets also saw pensions and stock holdings rise by A $ 130 billion in the quarter to gross A $ 4.7 trillion, while households held A $ 1.3 trillion. additional cash and bank deposits.

All of this helped offset an increase in debt from A $ 47 billion to A $ 2.5 trillion. This has left household balance sheets healthy on paper, although policymakers fear debt will grow faster than income which cannot be sustained indefinitely.

The Reserve Bank of Australia (RBA) this week warned that debt build-up could pose a risk to financial stability and may need to be limited by stricter lending rules. Read more

($ 1 = AU $ 1.3829)

Reporting by Wayne Cole; Editing by Ana Nicolaci da Costa

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