Increase in wealth, by wealth group since 2003

During the sustained period of economic growth from 2003-04 to 2018-19, wealth inequality increased sharply: * The wealth of the highest 1% of households rose (after inflation) by an average of $6.8 million or 84%; * The wealth of the highest 10% rose by an average of $1.9 million or 65%; * That of the middle 30% rose by an average of $380,000 or 44%; * That of the lower 60% rose by just $45,000 or 20%. In the first 2 years of the pandemic (during 2019-20 and 2020-21 including the recession), wealth inequality declined slightly: * The wealth of the highest 1% of households rose by an average of $1.5 million or 10%; * The wealth of the highest 10% rose by an average of $530,000 or 11%; * That of the middle 30% rose by an average of $168,000 or 13%; * That of the lower 60% rose by an average of $43,000 or 16%. In the third year of the pandemic (2021-22, a year of economic recovery), wealth inequality declined further: * The wealth of the highest 1% of households rose by an average of…

Average wealth by wealth group ($)

Consistent with the findings of our last Inequality in Australia report, wealth is still very unequally distributed in 2021-22. *The highest 10% of households by wealth has an average of $6.1 million or 46% of all wealth. *The next 30% have an average of $1.7 million or 38% of all wealth. *The lower 60% has an average of $376,000 or 17% of all wealth.

Profile of wealth of each wealth group

There is a significant inequality in wealth between of the highest 10% and the lowest 60% people in Australia. This graph presents the wealth profiles of these groups. Of the wealth of the richest 10% in 2021: • A higher proportion was held in investment property (18%), shares, bonds and trusts (13%), and own-business assets (9%), compared with 8%, 3% and 2% respectively for the middle 30%; • A lower proportion was held in their homes (32%), superannuation (19%), deposits (5%), and durables (4%), compared with 50%, 21% and 9% respectively for the middle 30%. Of the wealth of the lower 60% in 2021: • Higher proportions were held in superannuation (23%), durables (17%) and deposits (8%), compared with 21%, 9% and 7% respectively for the middle 30%; • A similar proportion was held in their homes (48% compared with 50%, taking account of people who were not owner-occupiers); • Almost negligible proportions were held in investment property (4%), shares, bonds and trusts (1%), and…

Total return indices

Source: Reserve Bank of Australia (2021), Statement on Monetary Policy, August 2021. Share prices in Australia and other countries in which Australians invest responded quickly to the recession, falling sharply. Over the following year they grew strongly - to end well above their average values from the beginning of 2020.  

Proportion of median income required to pay the median rent (%)

Source: ANZ Corelogic housing affordability report, March 2022 Note: Assumes owner has borrowed 80% of median dwelling value and is paying the average discounted variable mortgage for a term of 25 years This graph shows that the proportion of median household disposable income required to pay the median rent rose from 26% to 31% between 2003 and 2021.

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.

Share of all wealth by asset type held by each wealth group

From 2018 to 2022, the share of overall wealth held in owner-occupied homes rose from 37% to 41%. The predominance of owner-occupied housing in wealth accumulation through the pandemic moderated overall wealth inequality because owner-occupied housing is relatively concentrated in the middle 30% of the wealth distribution In 2021, the middle 30% held 46% of owner-occupied housing wealth, compared with 39% of superannuation, 26% of investment property, and just 14% of shares and 15% of own-business assets. In contrast, the richest 10% held 35% of owner-occupied housing, 42% of superannuation, 68% of investment property, 84% of shares and 82% of own-business assets

Concentration and share of overall wealth, by asset type, from 2018 to 2021

This graph shows trends in a measure of the concentration (inequality) of wealth within each asset type since the beginning of the pandemic. In 2018, this ‘concentration coefficient’ was: • Relatively high for shares, bonds and trusts (0.89), own business assets (0.89), and investment property (0.79); and • Relatively low for owner-occupied homes (0.57), superannuation (0.57), deposits (0.55) and durables (0.34). 27 The concentration coefficient has a value between zero (complete inequality) and one (complete inequality). There were slight variations in these ‘concentration coefficients’ between 2018 and 2021, for example the distribution of owner-occupied housing became slightly less concentrated (0.57 to 0.56).  

Average wealth of 131 billionaires compared with the top 1% of households ($m)

According to The Australian newspaper, in 2021 there were 131 billionaires (with wealth over a thousand million dollars) in Australia. Between early 2020 and early 2021, when adjusted for inflation to 2019 values their average wealth rose by 12% from $3,169 million to $3,574 million. Their overall wealth rose from $416 billion to $468 billion.  

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).