Australian households have taken advantage of COVID-19 relief measures to pay off credit cards and personal loans and add to their savings accounts. These actions contributed to an increase in household wealth during the June quarter.
According to the latest ABS figures, total household wealth rose by 1.5 per cent to A$11.1 trillion in the June quarter.
Average household wealth rose 1.4 per cent to $433,833 per person.
The growth was driven by a 4.6 per cent increase in the value of financial assets – superannuation fund accounts, equity holdings and deposits.
The value of super fund reserves rose $160.3 billion and there was a $31.2 billion increase in the value of household holdings of shares.
Government income support and other COVID-19 relief measures, combined with reduced household consumption during the quarter, contributed to a $33.4 billion increase in household deposits and a $5.4 billion reduction in short-term debt.
The big offsets were a $83.8 billion fall in the value of land and dwellings, and a $14.3 billion increase in the value of housing loans.
The ABS said households took advantage of record low interest rates to refinance mortgages and, in many cases, increase the amount of those borrowings.
Interest accruing on deferred loan repayments as part of COVID-19 relief also contributed to the rise in the value of housing loans.