HOUSEHOLDS – ECONOMIC ASPECTS – AUSTRALIA

Middle-income Australians experiencing rental stress with a third of pay spent on housing, report shows

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Original article by Cait Kelly
The Guardian Australia – Page: Online : 15-Jan-25

Data from Corelogic shows that housing rents increased by just 4.8 per cent nationally in calendar 2024, compared with 8.3 per cent in the previous 12 months. However, CoreLogic economist Kaytlin Ezzy says that households on the median income were still spending 33 per cent of their pre-tax income on rent charges in September 2024. CoreLogic’s figures also show that rents have increased by 36.1 per cent nationally since the start of the pandemic. Maiy Azize from the Everybody’s Home campaign has called for rent increases to be capped and more government investment in public housing.

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CORELOGIC AUSTRALIA PTY LTD, EVERYBODY’S HOME

Financial stress rising as high costs continue

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Original article by Matt Bell
The Australian – Page: 16 : 9-Dec-24

Research from credit rating agency Equifax suggests that 39 per cent of Australians are experiencing financial stress. The Equifax survey has also found that about 50 per cent of Australians have reduced their discretionary spending in the last year, compared with 37 per cent in 2022. Some 50 per cent of respondents also said their biggest financial priority for 2025 is paying down debt or ceasing to live from one pay cycle to the next. Separate data from the Australian Financial Security Authority shows that the number of personal insolvencies increased by 6.4 per cent year-on-year in the September quarter.

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EQUIFAX INCORPORATED, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN FINANCIAL SECURITY AUTHORITY

Inflation pain for households will linger well beyond 2026

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Original article by Simon Benson
The Australian – Page: 5 : 27-Nov-24

Analysis of the Reserve Bank’s forecasts in its statement on monetary policy for November suggests that real household income per capita will rise by 1.3 per cent in the current quarter, followed by growth of 1.2 per cent in 2025 and 1.1 per cent in 2026. However, Australians’ living standards are still set to be 4.4 per cent lower at the end of 2026 than at the time of the May 2022 federal election; this is despite the central bank factoring in a fall in the cash rate from 4.35 per cent at present to 3.5 per cent over the next two years. Shadow treasurer Angus Taylor said Australians are paying the price for Labor’s economic mismanagement, and they will continue to live with the damage of the inflation crisis well into the late 2020s.

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RESERVE BANK OF AUSTRALIA, LIBERAL PARTY OF AUSTRALIA

Households deplete pandemic savings

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Original article by Michael Read
The Australian Financial Review – Page: 3 : 28-Aug-24

The Reserve Bank of Australia has estimated that the nation’s households had amassed excess savings of about $300bn during the COVID-19 pandemic. However, National Australia Bank believes that this figure was about $200bn. Meanwhile, research from Yarra Capital Management suggests that households had most likely exhausted these pandemic-era savings by March 2024. Economists are now speculating as to whether consumers will opt to spend or save the additional income from the stage-three tax cuts that took effect on 1 July. Too much spending could force the RBA to leave the cash rate on hold for longer than expected.

CORPORATES
RESERVE BANK OF AUSTRALIA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, YARRA CAPITAL MANAGEMENT

Disposable income soared for richest Australians after pandemic but went backwards for the rest, report says

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Original article by Stephanie Convery
The Guardian Australia – Page: Online : 21-May-24

A report from the Productivity Commission has concluded that government assistance in response to COVID-19 resulted in an "unprecedented fall" in income inequality during the pandemic. The report found that household disposable income declined for 90 per cent of Australians early in the pandemic. However, the poorest households were hardest hit, with their income falling by eight per cent; in contrast, the income of the nation’s wealthiest households fell by just one per cent. The latter subsequently benefited the most from the post-pandemic rebound.

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AUSTRALIA. PRODUCTIVITY COMMISSION

Fears interest rates could be hiked in 2024

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Original article by Sarah Sharples
Herald Sun – Page: Online : 24-Apr-24

Australia’s employment and inflation outlook has prompted speculation that the Reserve Bank could increase rather than reduce the cash rate in 2024. Another official interest rate rise would put further pressure on mortgage holders. Data from Roy Morgan shows that 1.53 million mortgage holders were at risk of mortgage stress in March; CEO Michele Levine says Roy Morgan’s modelling shows that this would rise to 1.57 million mortgage holders if the central bank were to increase the cash rate by 0.25 per cent in both May and June, to 4.85 per cent.

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RESERVE BANK OF AUSTRALIA, ROY MORGAN LIMITED

First-timers, low earners in housing crunch

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Original article by Nila Sweeney
The Australian Financial Review – Page: 31 : 17-Apr-24

A report from the ANZ Bank shows that the average proportion of income that is needed to service a new mortgage rose to 48.9 per cent nationwide in the March quarter; this compares with 43.1 per cent during the same period in 2023. The ANZ Housing Affordability report also reveals that it now takes an average of 10.3 years to save enough money for a house deposit. Meanwhile, ANZ found that the average renter must now allocate 32.2 per cent of their income to rent; this rises to 54.3 per cent for low-income earners.

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AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

PM signals budget help for families, small business

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Original article by James Massola
The Sydney Morning Herald – Page: Online : 4-Apr-24

Prime Minister Anthony Albanese will use a speech on Thursday to state that small businesses and families will be ‘front and centre’ again in the federal government’s budget on 14 May. He will note that assisting families and small businesses with their energy bills was a key priority of the 2023 budget. Albanese’s comments in his Council of Small Business Organisations of Australia speech will heighten expectations that the government is set to extend its Energy Bill Relief fund, which is slated to end on 30 June. He will also emphasise the importance of small businesses to Australia’s future prosperity, noting that they are job creators, innovators and early adopters of technology such as clean energy.

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AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, COUNCIL OF SMALL BUSINESS ORGANISATIONS OF AUSTRALIA LIMITED

End of subsidy will risk power bill cut

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Original article by Patrick Commins, Sarah Ison
The Australian – Page: 1 & 2 : 20-Mar-24

The Australian Energy Regulator’s proposed changes to the default market offer could reduce household power bills by up to 7.1 per cent in 2024-25. Businesses in turn could see their electricity costs fall by up to 10 per cent. However, the AER’s proposed changes to the default market offer will be offset by a likely big increase in electricity bills for many households if the federal government does not renew its commitment to the energy bill relief fund in 2024-25, which is jointly funded by the states. It has provided energy subsidies to people on low incomes and small businsses.

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AUSTRALIAN ENERGY REGULATOR

Households face income pain until 2027: economists

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Original article by Michael Read
The Australian Financial Review – Page: 6 : 21-Feb-24

Analysis suggests that Australian real household incomes fell by 6.1 per cent in the year to September 2023, when adjusted for inflation and population growth. Real household incomes have now fallen for eight consecutive quarters, returning this metric to 2017 levels. Independent economist Chris Richardson does not expect real household incomes to return to pre-pandemic level until 2027; he adds while the revised stage-three tax cuts in mid-2024 will provide some relief for households, productivity growth will be necessary to boost living standards in the long-term. Deloitte Access Economics partner Stephen Smith in turn forecasts that household incomes will return to pre-pandemic levels by September 2025.

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DELOITTE ACCESS ECONOMICS PTY LTD