Aussie housing values now four-times larger than economy

The ABS yesterday released its property price data for the March quarter, which valued Australia’s dwelling stock owned by households at $7.9 trillion, whereas the total housing stock was valued at $8.3 trillion.

As shown below, the ratio of the dwelling stock owned by households against Australian GDP hit a record 4.0 times as at March 2021, up from June 2019’s trough of 3.3 times GDP. The total housing stock was valued at a record 4.2 times GDP in the March quarter, up from the last trough of 3.4 times GDP as at June 2019:

Australian housing to GDP

Australian housing values dwarf the economy.

Similarly, the total value of Australia’s dwelling stock owned by households hit a record 8.2 times employee incomes as at March 2021, up from June 2019’s trough of 7.0. The total housing stock was valued at a record 8.6 times employee incomes in March, up from the last trough of 7.3 trillion in June 2019:

Australian housing price to income ratio

Record price-to-income ratio.

When divided by Australia’s estimated resident population, Australia’s dwelling stock owned by households was worth a record $307,200 per head of population in the March quarter, up from the 2019 trough of $259,700 in real inflation-adjusted terms:

Per capita value of Australia's housing stock

Is this why Aussie’s are so wealthy?

Interestingly, CoreLogic’s latest chart pack reported that Australia’s residential real estate was valued at $8.4 trillion as at May 2021, which is marginally above the ABS’ estimate.

Australian housing values

Expensive houses

Given the pace of dwelling value growth, alongside record construction rates, Aussie dwelling values will likely exceed $9 trillion by year’s end.

Unconventional Economist
Latest posts by Unconventional Economist (see all)

Comments are hidden for Membership Subscribers only.