Around four in five Australians saw no change in their household finances in May, according to new figures from the Australian Bureau of Statistics (ABS).
ABS figures found that over the month, the share of Australians whose finances worsened slightly decreased to 12.1%. On the other hand, the proportion of Australians who reported improvement in household finance remained the same at 7%.
Over the same month, spending intentions, particularly for housing, improved, according to a recent Commonwealth Bank of Australia (CBA) study.
Home buying intentions rose in May, indicated by an increase in mortgage applications and Google searches. Additionally, gains in residential property prices also reflect the higher spending intentions for housing over the month.
“The high reading is no surprise given the strength in the housing market. The high reading is no surprise given the strength in the housing market," said Belinda Allen, senior economist at CBA.
CBA forecasted dwelling prices to grow by 14% over 2021 and 2022.
"We continue to expect the housing market to be a key source of support for the economy in 2021," Allen said.
Spending intentions for health and fitness, education, and motor vehicles also increased over the month. Meanwhile, spending intentions remained steady for travel and entertainment. Only the retail segment posted a slump in spending intentions over the month.
"Together with the strong labour market and positive wealth effects from rising dwelling prices, we expect consumer spending to support Australia’s economic growth in 2021,” Allen said.