A new survey has revealed that household savings directed towards property reached its highest level in over a decade during the September quarter.
The quarterly St.George-Melbourne Institute Household Financial Conditions Report found that household savings directed towards property lifted to 25.9 per cent during the quarter – the highest level since the index was established in March 2001.
Saving to buy or put a deposit on a house fell 2.1 percentage points to 13.8 per cent over the quarter, while saving to renovate or improve a home rose 1.4 points to 38.5 per cent.
The report also found that a mortgage was the most common form of household debt, with 36.5 per cent of respondents indicating they had a home loan – up from 36.1 per cent from the 12 months prior.
Looking more broadly, Australia’s household financial conditions declined marginally in the September quarter, but remain up 4.4 per cent on a year earlier.
St. George Bank chief economist Hans Kunnen said the improvement in financial conditions over the year can be attributed to a pick-up in employment growth and the low-rate mortgage cycle earlier in 2015.
“Those in the 25 to 64 age group saw the greatest improvement in financial conditions during the September quarter – likely to be positively affected by recent job creation and again lower mortgage rates,” he said.
“We also saw a strong rise in the financial condition of those at lower income levels during the September quarter – this may be a reflection of solid growth in part-time employment.”