Average annual change in disposable income during COVID-19

This chart shows how income inequality declined sharply in year one of the Covid recovery (2020-21) but was restored to its previous level in year two (2021-22). It shows that, in year one (2020-21), inequality declined. The average income of the lowest 20% grew by 5.2% after inflation, compared with 3% for the middle 20% and 2.4% for the highest 20%. In year two (2021-22) this pattern was reversed. The average income of the lowest 20% fell by 3.5%, compared with a fall of 0.5% for the middle 20% and a fall of 0.1% for the highest 20%. When we compare average growth in incomes for the two-year recovery period from 2019-20 to 2021-22, these effects largely cancel each other out leaving little change in income inequality overall. The income of the lowest 20% grew by an average of 0.8% per year, compared with 1.3% per year for the middle 20% and 1.1% per year for the highest 20%.

Average changes in hours worked and household incomes during COVID-19

This chart shows the changes in incomes and work hours during first years of the COVID-19 pandemic. It shows that, during ‘year one’ of recovery (2020-21), average household after-tax incomes grew by an extraordinary 3.1% after inflation, much faster than average income growth since the Global Financial Crisis. This occurred despite strict COVID lockdowns and the economic uncertainty surrounding the pandemic, which reduced average paid working hours per capita by 0.5% compared to hours worked in 2019-20. During ‘year two’ (2021-22), these trends were reversed. Average household incomes declined by 0.7% after inflation despite the reduced severity of lockdowns and a solid 2.4% increase in overall paid working hours per capita.

Household wealth per capita (2019 dollars)

This graph shows the longer-term trend in household wealth per capita since 2000 (per person rather than household so the numbers are lower than in our distributional analysis), adjusted for inflation. Since the recovery had a far greater impact on asset values than the recession, average household wealth rose by $341,000 over the 3 years from 2018 to 2021 after adjusting for inflation, compared with an increase of $327,000 over the 15 years from 2003 to 2018:15. * After declining by 3% in the March quarter 2020 (at the onset of recession), average household wealth rose by 12% to December 2020, then by an extraordinary 26% to December 2021. * On average, it rose by 11% per year after inflation from 2018 to 2021, compared with just 3% per year from 2003 to 2018.

Increase in real net household wealth per capita

From December 2018 to December 2021 real net household wealth rose by 43%. Of this increase: * Over half (55% of the increase) came from owner-occupied housing (which comprised 37% of all wealth in 2018); * One-seventh (14%) came from investment property (11% of wealth in 2018); * One-sixth (16%) came from superannuation (22% of all wealth in 2018); * The remaining 15% of the increase in overall wealth came in roughly equal measure from shares bonds and trusts, bank deposits, business assets, and household durables18 (which together comprised 30% of all wealth in 2018).

Net saving per capita

As outlined in our previous report on the impact of  COVID on income inequality and poverty, public income supports such as JobKeeper Payment and the Coronavirus Supplement boosted the incomes of many low-income households while COVID restrictions reduced spending on such items as holidays, entertainment and eating out35. The result was a sharp increase in overall household saving.

COVID-19: Housing market impacts and housing policy responses - an international review

COVID-19: Housing market impacts and housing policy responses - an international review

Median advertised rents by state/territory in Australia, 2019-2021

This graph shows the phenomenon of regional rents ‘outperforming’ the relevant capital city in Australia from 2019-2021. This was especially marked in New South Wales (+17% versus-2%), Tasmania (+26% versus +8%) and Victoria (+15% versus -7%). Also notable is that Western Australia, where geographical isolation and a closed border largely enabled avoidance of economic restrictions during the first two years of the pandemic, the pattern was completely different.

Weekly eviction filings in 2020 and 2021 as a % of pre-pandemic norm, USA

In the USA.  series of eviction moratoriums from multiple agencies and levels of government were introduced over the period of the pandemic, many of which had lapsed by July 2020. Nationally, Congress included evictorion moratorium in the Coronavirus Aid, Relief and Economic Security (CARES) Act, which commenced on 27 March 2020. This appled to 'federally related properties', including propoerties supported by federally-backed finance or occupied by tenants with Housing Choice vouchers. For the properties it coered, it prohibited the commencement and enforcement of eviction proceedings for unpaid rent until 23 August 2020. From 4 September 2020, two weeks after the CARES Act expired, the CDC National moratorium was imposed, which covered all tenants meeting certain income and hardship criteria, including that they had applied for government assistance and would be at risk of homelessness or overcrowding if evicted. Tenants seeking the moratorium protection were required to declare…

Possession Actions in England, 2019-2021

UK governments did not regulate rents during the emergency, and a public campaign for the suspension or cancellation of rent arrears was rejected. Instead, various measures of financial assistance were implemented: in March 2020, Local Housing Allowance was increased to cover 30% of market rents (restoring an earlier link, severed in 2016), and in late 2021 English local authorities were allocated additional funds to support low-income tenants still in rent arrears. The Scottish and Welsh Governments implemented loan schemes for the payment of arrears: the Scottish scheme paid up to nine months’ rent arrears, for repayment over a period of up to five years. Government data on termination proceedings (‘possession claims’) in England show a dramatic reduction in the pandemic period. Possession claims by all landlords in Q2 2020 were down 88% on the same quarter the previous year, and claims for 2020-21 were down 79% on the previous year; however, the largest reductions were by social…

Evictions, Spain, 2019-2021

In Spain, from October 2020, the Spanish government paid compensation to landlords of non-paying vulnerable tenants protected by the moratorium, based on losses relative to average rents. It also limited the application of the eviction moratorium to lawful tenants, after squatters were able to claim protection under the first version. This graph shows that Spanish evictions in the second quarter of 2020 dropped dramatically – especially evictions for rent arrears, which were down 90% year on year. Subsequently, however, evictions rose, to 75% of the previous year’s level in Q3, and exceeded the previous year’s level in Q1 2021.