In 2025, Australians’ wealth increased due to rising property prices and higher retirement savings, boosting total household wealth by 2.5% (AUD 453.7 billion) in the last quarter, according to the Australian Bureau of Statistics (ABS).
Land and residential housing recorded a 3.2% increase (AUD 368.6 billion), contributing two percentage points to household wealth growth, while retirement savings added 0.3 percentage points.
However, Dr. Mich Tan, Head of Financial Statistics at the ABS, noted that rising borrowing limited wealth gains, as household loans grew by 2.0% (AUD 64.2 billion), reducing overall wealth growth by 0.3 percentage points. Australia ranks second globally in average wealth per adult at AUD 385,600, but questions remain about the sustainability of this upward trend.
By 2026, growth will depend heavily on the impact of the Middle East conflict on the economy and its duration. A strong labor market is essential to maintain income and retirement savings, but rising interest rates have pushed unemployment up to 4.3% in February 2026, compared with 4.1% in January.
As interest rates rise, consumer spending and business investment slow down, putting pressure on companies to cut costs and jobs, leading to potential job losses. If the blockade of the Strait of Hormuz continues and the economy faces additional strain, even the property market could face a significant hit.
