Home Values Hit $10.3trn as Handouts Fuel GDP Growth

Another 52,300 homes worth $261 billion were added to Australian residential stock last quarter.

The total value of homes in Australia rose to $10,267.4 billion across the September quarter and there were 11,094,500 homes nationally, the latest Australian Bureau of Statistics showed.

The mean price of homes rose by $19,200 to $925,400. Of the total value of homes, $9863.4 billion was owned by households.

Across the September quarter, the total value of homes rose in all states and territories.

The mean price in NSW ($1,187,200) remained the highest, followed by the ACT ($943,800) and Victoria ($903,600). The lowest was the Northern Territory ($525,900).

Meanwhile, Australian GDP rose 0.2 per cent (seasonally adjusted, chain volume measure) during the quarter and by 2.1 per cent since September last year, the bureau said.

Bureau head of national accounts Katherine Keenan said this was the eighth straight rise in quarterly GDP but that growth had slowed during 2023.

“Government spending and capital investment were the main drivers of GDP growth this quarter,” she said.

Government final consumption expenditure rose 1.1 per cent during the quarter after a 0.6 per cent increase in the June quarter.

“The growth in government expenditure was driven by social benefits to households, including the Energy Bill Relief Fund rebates, and extra payments for childcare, aged care and pharmaceutical products,” Keenan said.

Defence also contributed to growth with increased expenditure related to international training exercises held in Australia this quarter.

Gross fixed capital formation rose 1.1 per cent, which was driven by public corporations.

▲ Defence exercises involving Australian and overseas forces contributed to growth.

“Investment by public corporations rose 8.9 per cent. Commonwealth, state and territory corporations increased investment in transport, communication and utilities projects,” Keenan said.

Private engineering construction also rose due to increased mining industry investment.

“Household spending was flat in the September quarter, as government benefits and rebates reduced household spending on essential services such as electricity” Keenan said.

Vehicle purchases went up in September as supply constraints continued to ease.

The household saving-to-income ratio was at its lowest level for almost 16 years. It fell for the eighth straight quarter to 1.1 per cent, its lowest level since the December quarter of 2007.

"The removal of the Low and Middle Income Tax Offset in the 2022-23 financial year meant many households had a higher income tax bill this quarter, which has contributed to the fall in the household saving ratio,” Keenan said.

“Increased interest paid on home loans and inflationary pressure on households were also likely factors behind the fall in the household savings ratio.”