Invest
Australia’s financial sector balloons to just under $11 trillion
Strong bounces in property and share prices over the last 18 months have seen Australia’s financial sector balloon to well over $10 trillion, new research has revealed.
Australia’s financial sector balloons to just under $11 trillion
Strong bounces in property and share prices over the last 18 months have seen Australia’s financial sector balloon to well over $10 trillion, new research has revealed.
Stats released by Roy Morgan’s Banking and Finance Report revealed that Australia’s total market for financial services grew by a record 13.2 per cent over the last financial year to a total of almost $10.9 trillion in June.
All four categories, including owner-occupied homes, wealth management, traditional banking and direct investments showed signs of growth.
Australia’s financial fortunes remain tied up with the property market, which at the end of June made up a third of Australia’s total wealth at $3.83 trillion. Despite an increase of $277 billion on a year ago, the overall share was down by 1.8 per cent from June 2020.
Wealth management is the second largest segment representing well over a quarter of the entire financial services market with a value of $3.06 trillion, while direct investments now represent 12.9 per cent with a value of $1.39 trillion.
An influx of savers saw Australia’s traditional banking sector become the fastest-growing category, up to 23.8 per cent of the nation’s wealth with a value of $2.59 trillion. This is the highest share of the overall financial services market represented by traditional banking over the last five years and an increase in value of over $500 billion on a year ago.
Explaining the impressive overall growth of the financial sector, Roy Morgan’s CEO, Michele Levine, pointed to the government’s hefty stimulus packages, which have helped carry the sector amid an economic downturn.
“For many Australians, the government stimulus went straight into the bank account with a lack of options for spending it with international (and, for much of the time, domestic) borders closed and travel restricted,” she said.
Ms Levine opined that much of the predicted damage to the Australian economy did not occur as a result of the government’s aid, which ultimately helped the financial services boom.
“The COVID-19 pandemic hit Australia nearly 18 months ago in March 2020, and at the time there were significant worries about the durability of the Australian economy as well as key financial assets such as housing, stock-market investments and traditional banking and wealth management accounts,” she added.
Not only is the market showing resilience, but Ms Levine believes history could repeat itself post the current lockdown restrictions.
“Although the next few months are set to be tough ones for many Australians forced out of work by the lockdowns, there is an optimistic view that once the vaccination thresholds are reached towards the end of this year, the economy will quickly recover from this ‘third wave’ of COVID-19,” she concluded.
About the author
About the author
Property
Retirement communities: a pivotal element in meeting Australia's housing targets
The Retirement Living Council (RLC) has recommended that retirement communities should be considered a vital part in the Australian Government's initiative to fulfill the Housing Australia Future Fund ...Read more
Property
Australians adjust financial strategies amid changing property market dynamics
The 2023 calendar year saw Australian borrowers acquiring a total of $300.9 billion in new loans for property purchases, marking a 12.7% decrease from the previous year. Read more
Property
Split home loans unlocking doors for Aussie buyers
Australians are teaming up to dive into the real estate market and seize the advantages of home ownership, with the trend of split home loans surging as family and friends unite to buy properties ...Read more
Property
Real estate investment: Spotting high-growth potentials
Investing in real estate has long been a favoured approach for Australians looking to grow their wealth. Read more
Property
Granny flats become Aussie families' cost-effective solution to soaring living costs
As the cost of living skyrockets, a forward-thinking trend is sweeping across Australia – granny flats are becoming a favoured living arrangement for older Aussies seeking comfort and proximity to ...Read more
Property
Homebuyers grapple with extended savings period amid affordability crisis
Gone are the days when an Australian dream home seemed just within reach. The path to homeownership in Australia has extended by at least two arduous years, as revealed by the latest insights from ...Read more
Property
Hybrid development unlocks new potential for NDIS housing in metro hotspots
In a ground-breaking strategy aimed at addressing the stark imbalance between the location of Specialist Disability Accommodation (SDA) developments and the actual areas of demand, Aligned Disability ...Read more
Property
Property prices boosted by housing policies: RBA
The central bank has outlined the “pervasive” impact that policy has on property. Read more
Property
Retirement communities: a pivotal element in meeting Australia's housing targets
The Retirement Living Council (RLC) has recommended that retirement communities should be considered a vital part in the Australian Government's initiative to fulfill the Housing Australia Future Fund ...Read more
Property
Australians adjust financial strategies amid changing property market dynamics
The 2023 calendar year saw Australian borrowers acquiring a total of $300.9 billion in new loans for property purchases, marking a 12.7% decrease from the previous year. Read more
Property
Split home loans unlocking doors for Aussie buyers
Australians are teaming up to dive into the real estate market and seize the advantages of home ownership, with the trend of split home loans surging as family and friends unite to buy properties ...Read more
Property
Real estate investment: Spotting high-growth potentials
Investing in real estate has long been a favoured approach for Australians looking to grow their wealth. Read more
Property
Granny flats become Aussie families' cost-effective solution to soaring living costs
As the cost of living skyrockets, a forward-thinking trend is sweeping across Australia – granny flats are becoming a favoured living arrangement for older Aussies seeking comfort and proximity to ...Read more
Property
Homebuyers grapple with extended savings period amid affordability crisis
Gone are the days when an Australian dream home seemed just within reach. The path to homeownership in Australia has extended by at least two arduous years, as revealed by the latest insights from ...Read more
Property
Hybrid development unlocks new potential for NDIS housing in metro hotspots
In a ground-breaking strategy aimed at addressing the stark imbalance between the location of Specialist Disability Accommodation (SDA) developments and the actual areas of demand, Aligned Disability ...Read more
Property
Property prices boosted by housing policies: RBA
The central bank has outlined the “pervasive” impact that policy has on property. Read more