It’s been 15 long years since the former Balmain Leagues Club was open to the public. The large 7,330 sqm Victoria Road site had grown progressively more derelict since the doors to the former club shut back in 2010.

Earlier this year, the vertically integrated developer PERIFA, part of the Versatile Group of companies, stepped in and acquired the site, quickly getting to work on construction through its building business Versatile Construction.

PERIFA teamed up with financier Mitsubishi Estate Asia to create <a href="https://www.apartments.com.au/new-apartments/rozelle-village-rozelle-152-victoria-road-rozelle-nsw-2039">Rozelle Village</a>, a new community heart of the charming inner west suburb. The mixed-use precinct will not only be home to around 150 one-, two-, and three-bedroom apartments, but also feature a fully activated ground plane with extensive hospitality venues and retail spaces.

[smartcode_project:default project_id=8142 project_image_fid=338]

A new club will replace the old Balmain Leagues Club. The public plaza will include a range of new food and hospitality venues, a community art studio, and a retail precinct anchored by a full-line supermarket, a first for the peninsula.

The apartments will be spread across three interconnected buildings designed by Studio SC, with interiors by SJB.

[smartcode_project:default project_id=8142 project_image_fid=335]

Buyers weren’t prepared to wait any longer to purchase. When it was time to start selling the development, PERIFA and SRM Residential had buyers queuing out of the display suite door. They secured over 40 sales on launch, including several high-end three-bedroom apartments with sales reaching up to $6.9 million.

Demand has been driven largely by local owner-occupiers who have had <a href="https://www.apartments.com.au/developments/rozelle-nsw-2039">Rozelle</a><a href="https://www.apartments.com.au/new-apartments/rozelle-village-rozelle-152-victoria-road-rozelle-nsw-2039"> Village</a> on their radar for some time, many of them already living in apartments and looking to upgrade without giving up lifestyle, walkability, or views.

[smartcode_project:default project_id=8142 project_image_fid=325]

Perilli, Co-Founder and Managing Director of PERIFA and Versatile Group, said the community has had to put up with a derelict site on their doorstep for too long.

“The Balmain Leagues Club in Rozelle, which closed in 2010 to make way for the NSW Government Metro Transport Project, was once a hub for local families to come together and enjoy entertainment and hospitality. We’re delighted to embark on a new era for the site, together with our partners Mitsubishi Estate Asia,"&nbsp;Perilli said.

"Our shared vision for <a href="https://www.apartments.com.au/new-apartments/rozelle-village-rozelle-152-victoria-road-rozelle-nsw-2039">Rozelle Village</a> is to create a mixed-use precinct that is thoughtfully designed and caters to new residents and the community alike. It will be a major meeting place for the community that embraces the unique character of the Balmain/Rozelle peninsula, while helping to shape its next chapter.”

[smartcode_project:default project_id=8142 project_image_fid=326]

The residential offering will cater to downsizers, families, and local owner-occupiers, with an emphasis on larger floorplans, high-quality finishes, and expansive views across Iron Cove, Sydney Harbour, and the Parramatta River.

Residents will have private access to a rooftop pool, taking in the views, a rooftop yoga lawn, and podium level gardens.

[smartcode_project_cta:default project_id=8142]

Joel Robinson

From leagues club to lifestyle precint: Inside Rozelle Village 

Roberts Co has entered a new phase of growth following its acquisition by Arada, one of the world’s fastest-growing property developers in Australia.

The acquisition is supported by a $50 million capital injection into Roberts Co’s Australian balance sheet, consisting of the previously announced $25 million recapitalisation and an additional $25 million in new funding from Arada.

This investment strengthens Roberts Co’s financial position, stabilises operations, and provides the foundation for strategic expansion beyond its New South Wales base, with a focus on new opportunities in Queensland, including the Brisbane and Gold Coast regions.

With Arada’s international resources and financial backing, Roberts Co will broaden its portfolio across residential, commercial, and infrastructure sectors, reinforcing its strong market position in New South Wales and setting itself to capture growth in one of Australia’s most dynamic construction markets.

Ahmed Alkhoshaibi, Group CEO of Arada, said Roberts Co has a proud Australian heritage, an outstanding delivery record, and a strong reputation for collaboration with clients and partners.

"By combining this expertise with Arada’s global scale and financial capacity, we are creating a platform for sustained growth in the Australian market,"&nbsp;Alkhoshaibi said.

“Our $50 million capital injection, including new funds from Arada, underlines our commitment to both stabilise and expand Roberts Co’s operations, particularly into the fast-growing Queensland market. We see significant potential in South-East Queensland’s pipeline and are confident Roberts Co is well placed to deliver lasting value for clients and communities.”

George Kostas, CEO of Roberts Co, said Queensland, and particularly South-East Queensland, is one of the most active and opportunity-rich regions in Australia right now.

"The lead-up to the Brisbane 2032 Olympic Games will bring unprecedented investment across housing, transport, and infrastructure. Roberts Co is eager to play a major role in that transformation and secure a meaningful share of this fast-growing market.”

Arada pours more funds into Roberts Co, flags expansion into South East Queensland construction market

<a href="https://www.apartments.com.au/developments/hurstville-nsw-2220">Hurstville</a> has quietly become one of Sydney’s most resilient property markets. Supported by strong transport links, infrastructure investment and a growing multicultural community, the St George hub continues to outperform much of the metropolitan market for both capital and rental returns.

According to Positus Property Investment, Hurstville now ranks among Sydney’s top performers for yield consistency, underpinned by population growth of nearly five per cent since 2021 and persistently low vacancy rates.&nbsp;

Limited new supply is tightening the market further - new dwelling approvals have fallen from close to 600 to under 200 in FY25, a structural shortfall that’s placing upward pressure on rents and resale values.

[smartcode_project:default project_id=149850 project_image_fid=278]

As one of the final residential stages in the Kempt Field precinct anchored by Woolworths, <a href="https://www.apartments.com.au/developers/the-one-collection">The One Collection</a>'s <a href="https://www.apartments.com.au/new-apartments/horizon-hurstville-6-jack-brabham-drive-hurstville-nsw-2220">Horizon</a> represents a rare opportunity to buy into a location experiencing both infrastructure-led growth and constrained supply&nbsp;- now made even more compelling with a limited-time five per cent deposit and matching rebate incentive.

Positus notes that the suburb’s combination of “relative affordability, low vacancy, and rising population” is creating a recipe for continued rental growth and capital appreciation. Weekly rents are increasing faster than strata and outgoings, with two-bedroom apartments seeing the deepest tenant demand - supporting healthy yield margins even after costs.

[smartcode_project:default project_id=149850 project_image_fid=281]

Horizon prices begin from $668,000, with one, two, and three-bedroom apartments offering flexible entry points for investors.&nbsp;

The project’s location, a short walk to Hurstville Station, Westfield, and an upcoming dining laneway, St Clair Lane, underscores its liquidity and day-to-day convenience.&nbsp;

A 19-minute express train connects residents to the Sydney CBD, while arterial upgrades such as the M6 and WestConnex further enhance connectivity.

[smartcode_project:default project_id=149850 project_image_fid=275]

Designed by <a href="https://www.apartments.com.au/architects/dko-architecture">DKO Architecture</a>, Horizon’s soft, organic façade mirrors the parkland of Kempt Field, while interiors prioritise light, durability, and smart functionality.&nbsp;

Each home features Smeg appliances, smart home automation, and generous balconies overlooking the bay and skyline.&nbsp;

Amenities include a gym, sauna, games room, meditation deck, and landscaped courtyards, with wellness and social spaces designed to foster community.

[smartcode_project:default project_id=149850 project_image_fid=279]

From an investment perspective, Horizon offers what Positus describes as a “value and income sweet spot.” At an average entry price around $745,000 and yields near five per cent, Hurstville units remain roughly $200,000 below comparable inner-west suburbs, allowing investors to capture metro proximity without inner-city risk exposure.

Horizon will deliver 179 one, two, and three-bedroom apartments above St Clair Lane.&nbsp;<a href="https://www.apartments.com.au/builders/masscon">Masscon</a> is on site moving its way up the building, which is scheduled for completion in late 2026, with move-in expected shortly after.

One Collection is currently offering a five per cent deposit incentive for a limited time.

[smartcode_project_cta:default project_id=149850]

Staff Writer

The One Collection opens new investment window at Horizon Hurstville with limited-time incentives

The Gold Coast has cemented its position as one of Australia's hottest construction markets, with crane numbers reaching a record 67 in Q3 2025, the highest count since tracking began.

The latest Rider Levett Bucknall (RLB) Crane Index shows the region at 447 points, also a record, with activity surging 110 per cent over the past three years as population growth and investor confidence drive unprecedented development activity.

Residential construction dominates the skyline almost entirely, accounting for 95.5 per cent of all cranes across the Gold Coast. Of the 67 cranes currently operating, 64 are dedicated to residential and mixed-use apartment projects. 21 new cranes were added in Q3 2025 alone, with major developments spanning Surfers Paradise, Main Beach, Broadbeach, Mermaid Beach and Southport reflecting sustained confidence across the coastal corridor.

[smartcode_project:default project_id=108747 project_image_fid=318625]

The construction boom aligns with exceptional apartment market performance. Gold Coast unit prices reached $950,000 in September 2025 according to the latest Ray White Now Monthly, delivering robust 8.6 per cent annual growth and 0.6 per cent monthly appreciation.

This significantly outperforms the national apartment market average of 6.9 per cent and positions the Gold Coast as Australia's most expensive apartment market, trending ahead of Sydney. This highlights the premium investors and owner-occupiers place on the region's lifestyle amenity.

The scale of residential development reflects both build-to-sell apartment projects targeting owner-occupiers and investors, alongside emerging build-to-rent developments as institutional capital increasingly targets the Gold Coast. Population growth continues driving demand, with the region attracting interstate migrants seeking lifestyle amenity and professionals relocating from southern capitals to embrace coastal living while maintaining career opportunities.

[smartcode_project:default project_id=112941 project_image_fid=216014]

Project activity spans multiple price points and buyer demographics. Premium waterfront developments in Main Beach and Broadbeach command the highest values and attract downsizers alongside investors, while projects in Varsity Lakes and growth suburbs target first home buyers seeking more affordable entry points into the Gold Coast market. The concentration of cranes along established precincts with beach access reflects where buyer demand remains strongest.

Notably absent from the Gold Coast's construction pipeline is commercial office development, with zero commercial cranes currently operating. The only non-residential activity comprises aged care and education. This underscores the Gold Coast's evolution as a residential growth market rather than a CBD destination, with the regional economy built around tourism, construction, lifestyle services and residential property rather than traditional office demand.

The sustained construction pipeline through Q3 2025 suggests apartment completions will remain elevated through 2026, providing necessary supply for the growing population. With development activity at record levels and strong price growth supporting feasibility, the Gold Coast apartment market continues delivering solid returns for developers and investors navigating Australia's shifting property landscape.

Gold Coast construction hits record high as apartment market delivers strong returns

<a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Group</a> is has officially launched its next residential project, the $240 million Symphony in South Brisbane. It marks&nbsp;the group’s entry into the Brisbane market as it expands the Flourish brand to deliver design-forward, fairly priced homes in an undersupplied market.&nbsp;

With 25 out of 138 apartments priced under $1 million, <a href="https://www.apartments.com.au/new-apartments/symphony-south-brisbane-21-23-cordelia-street-south-brisbane-qld-4101">Symphony</a> is expected to attract first home buyers, with Sherpa reserving all one-bedroom and two-bedroom, one-bathroom apartments under $1 million for owner-occupiers and first-home buyers.&nbsp;

Sherpa CEO Christie Leet, said the project is a strategic move to deliver attainable housing in connected, culturally vibrant neighbourhoods, with locals prioritised.&nbsp;

“Our aim with Flourish has always been to help the community,” said Leet.

“That’s why we have chosen to release Symphony to locals first, reserving a portion of apartments for owner-occupiers and first-home buyers to give them a genuine chance to get their foot in the door.”

[smartcode_project:default project_id=7574 project_image_fid=3770]

Located at 21-23 Cordelia Street, <a href="https://www.apartments.com.au/developments/south-brisbane-qld-4101">South Brisbane</a>, Symphony will feature a collection of 138 high-quality apartments, offering spacious one, two and three-bedroom layouts, with prices starting from $655,000.

“It’s no secret that affordability remains a huge issue in today’s market, and many people are simply being priced out,” Leet added.

“We at Sherpa see it as our responsibility to bring well-designed, fairly priced homes to market – that’s what we stand for.”

[smartcode_project:default project_id=7574 project_image_fid=353548]

Residents will have access to a resident rooftop with offers over 1,400 sqm of premium resort-style amenities across two levels. These include a wellness centre with a steam room, sauna, hot and cold plunge pools, a heated pool, as well as pool deck cabanas, private outdoor barbecues, a private dining room, a fully equipped gym, and a yoga room, all with views of the Brisbane skyline and Mt Coot-tha.

Sherpa has also hired a full-time concierge service to assist buyers with the off the plan process, from construction updates, hard hat tours, to showing and helping residents use their appliances once they have moved in.&nbsp;

[smartcode_project:default project_id=7574 project_image_fid=5155]

“Every amenity at Flourish has been designed to help foster a sense of community,” said Danial Clarke, Development and Financial Manager of Sherpa Group.&nbsp;

“The rooftop will be a sanctuary from the city, a place where residents can connect, relax, and ultimately flourish.”

Positioned at the junction of South Bank, West End, and Fish Lane, Symphony offers exceptional walkability to QPAC, galleries, riverside parklands, the CBD, major universities, hospitals, and transport hubs.

Sherpa has already appointed LPS Group to build Symphony. The duo are working together on Sherpa's Palm Beach portfolio.

[smartcode_project_cta:default project_id=7574]

Sherpa officially launches Symphony South Brisbane

Household Finance

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The latest ratios of household finances highlight that the ratio of debt to disposable income is at a record high however, the value of household assets is also at a record high level.
With record low interest rates, the ratio of interest payments to disposable income is the lowest it has been since early 2003.
The ratio of household and housing debt to disposable incomes are each at historic highs of 186.3 percent and 133.8 percent respectively with the ratios increasing by 3.4 percent and 4.3 percent over the past year; 
Over the period from 1988 to 2015 standard variable mortgage rates have fallen dramatically and that has surely contributed to household’s preparedness to take on more debt.
<a href="/images/2016/03/31/Screen%20Shot%202016-03-31%20at%201.11.34%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/31/Screen%20Shot%202016-03-31%20at%201.11.34%20PM.png" alt="">
 
Over recent years the ratio of interest payments to disposable income has been falling with the ratios for households and housing now sitting at their lowest levels since 2003. The higher ratio of interest payments currently compare to 1988 when interest rates were substantially higher.
This is reflective of the much higher cost for household assets, particularly the cost of residential housing.
The data shows that although households have significant debt, particularly for housing, the value of the assets they hold is substantial. The ratio of household debt to disposable income is currently 186.3 percent however, the ratio of household assets to disposable income 862.8 percent, the highest it has ever been.
Similarly, the ratio of housing debt to disposable income is 133.8 percent however; the ratio of housing assets to disposable income is 471.3 percent.
What is interesting is that the ratio of household assets to disposable income is still lower than its previous peak in December 2007 at 476.2% percent, however, it is nudging back up towards its previous record high.
The value of household assets is significantly greater than the value of the debt. Based on this data, the ratio of household debt to assets is 21.6 percent and the ratio of housing debt to housing assets is 28.4 percent.
<a href="/images/2016/03/31/Screen%20Shot%202016-03-31%20at%201.16.17%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/31/Screen%20Shot%202016-03-31%20at%201.16.17%20PM.png" alt="">
 
Australian households are heavily indebted due largely to residential housing and while high; the value of the assets held is much greater than the debt. It’s important to consider that this is a national view.
Across different regions the ratios are likely to be substantially different. Furthermore, lower interest rates and a fairly strong labour market over recent decades have contributed to a willingness to borrow. Should either of these factors to change it could lead to a dramatic deterioration in the value of these assets while of course the debt would remain.
Importantly, mortgage arrears remain low and the Reserve Bank has reported that the typical mortgage holder is currently more than two years ahead on their mortgage repayments. This coupled with higher rates of household savings provide a potential buffer if unemployment were to rise sharply or interest rates began to increase.
Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
 
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ckusher-ujnxiKuFQs

Household and housing debt reach new record highs: CoreLogic RP Data's Cameron Kusher

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EXPERT OBSERVER
Large inflows of relatively young migrants have supported population growth and increased the share of the population aged 25–34 over the 2010s (Graph 2).[1] Despite this, the population has continued to grow older on average because the large baby boomer generation have begun to move into the 65 and over category and because of the ongoing trend increase in life expectancy. By contrast, people aged 35–54 have made only a very modest contribution to growth in the population, unlike in prior decades when the baby boomers moved through this age group. As a result, the number of people at retirement age per 100 working-age people (those aged between 15 and 64) has risen from around 20 to 25 over the past decade and is expected to rise further over the next decade.
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-02.svg" alt="Graph 2: Changes in Population Age Segments" width="620" height="539">
Alongside these demographic developments over the past decade, there have been noticeable changes in key economic indicators for the household sector. Disposable income grew at a reasonably strong pace over the 1990s and 2000s, but income growth has been subdued over the 2010s (Graph 3). Growth in household consumption has also slowed. The saving ratio increased noticeably starting from the mid 2000s, but has declined more recently. A range of structural and cyclical factors have contributed to these trends. These include: the global financial crisis; the mining boom and its unwinding; higher levels of household debt; weakness in non-labour income; growth in household income tax revenue; and the recent downturn in the housing market.[2] Considering the contribution demographics have made to these trends, alongside these other factors, can help us further understand developments to date and how they might evolve in the future.
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-03.svg" alt="Graph 3: Household Consumption and Income" width="620" height="500">
This article uses an Australian Bureau of Statistics (ABS) dataset that combines household-level information from the Household Expenditure Survey (HES) and the Survey of Income and Housing (SIH) with the national accounts to explore what effect demographic changes are likely to have had on household consumption and income over recent decades.[3] In this dataset, the relevant household information, such as age, is grouped according to a designated ‘household reference person’.[4] This dataset is broadly representative of the Australian household sector and includes persons living in non-private dwellings (such as nursing homes) and persons in very remote communities, who are often out-of-scope in micro datasets.[5]Consistent with the changes in the aggregate population, the share of households with reference persons' aged 55 and above in this dataset has increased from around one-third in 2004 to nearly half in 2018. The descriptive statistics offered by these data do not allow demographic effects to be isolated from other variations between households that may have been correlated with age. Nonetheless, they allow an examination of the average differences between households of different ages and how those differences contribute to the aggregate household sector and economy.
Income and consumption tend to decline with age …
Some portion of the slowing in consumption growth over the past decade is likely to be due to the ageing of the population. This is because the distribution of average household consumption by age in Australia follows a hump-shaped pattern: spending generally increases through the working life of a household, rising noticeably for households aged 35–54 in the stage of their life where many households support children and then declines once they retire. The decline in consumption is particularly pronounced for households aged 65 and over (Graph 4).[6] The reasons for a reduction in average spending for the 65 and above category would vary by household, but some likely explanations include a reduction in income as people enter retirement (discussed further below), lower weekly expenses (such as transport and eating out) after exit from the workforce, no longer needing to support children and actual or perceived inadequate savings for retirement.[7] The decline in the consumption of older households is not as large when incorporating social transfers provided by the government (discussed further below).
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-04.svg" alt="Graph 4: Real Household Consumption" width="620" height="519">
The ageing of the population is also likely to have made some contribution to the slowing in income growth over the past decade. Similar to the distribution of consumption by age, household income generally increases through the working life of a household and then declines as they approach retirement (Graph 5). Households aged 65 and above typically have lower levels of income than those aged 25–54, and around 40 per cent of households 65 and over are in the lowest income quintile.[8] However, these older households are typically wealthier; only 25 per cent are also in the lowest two wealth quintiles.
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-05.svg" alt="Graph 5: Real Household Income" width="620" height="536">
However, stronger income growth over the past decade has supported higher consumption growth for older households
The impact of the growing number of older households on aggregate consumption has been partly mitigated by a shift in the shape of the lifetime consumption distribution over the past decade. Average consumption per household aged 55 years and above has grown nearly twice as fast as the average of other households (Graph 6). In 2017/18, households aged 55–64 consumed more on average ($123,000) than those aged 35–44 ($111,000), although less than those aged 45–55 ($128,000). Stronger consumption growth for older households has partly reflected stronger growth in their incomes, compared with other age groups. Changes in household composition (such as children staying at home for longer or increased life expectancy) may be another contributing factor to consumption growth per household.
By contrast, the youngest households (those aged 24 and below) on average saw no growth at all in their consumption and a decline in their real income in the six years following the global financial crisis. The smaller share of the population comprised of these households, relative to prior decades, means that the effect on aggregate consumption has been smaller than it otherwise would have been.
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-06.svg" alt="Graph 6: Real Household Consumption" width="620" height="505">
Aggregate growth in household disposable income has slowed noticeably over the past decade and has been lower than consumption growth for most of the past five years. But, as noted above, income growth across the age distribution has varied. Income growth was stronger for older households than for younger ones (Graph 7).[9] For example, households aged 15–24 had more disposable income than households aged 65 and over in 2003/04, but in 2017/18 earned about the same, and they still had significantly less wealth. As in the case of consumption, stronger growth in older households' incomes has reduced the effect of the ageing population on aggregate income.
For households aged 55–64 years, a key driver of stronger growth in overall income relative to other households has been strong growth in labour income. This has been supported by increased participation in the labour force, mainly by women. The female participation rate for those aged 55–64 years has increased from around 30 per cent in 1999 to a little more than 60 per cent in 2020.[10] For households aged 65 and above, growth in income over the past 15 years has also been supported by strong growth in non-labour sources of income such as financial income, rental income and social assistance income.[11]
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-07.svg" alt="Graph 7: Household Real Income Growth by Age" width="620" height="577">
Financial income has grown more strongly than any other source of household income over the past 15 years. All age groups have benefited, but older households benefited the most because they hold more financial wealth, on average. Total financial returns for households over this period would be even larger if capital gains were included, but financial income in the national accounts excludes capital gains. This understates the total financial returns of households, particularly for older households because they receive the largest share of their income from financial wealth.
Older households save less of their current income than younger households
Households across most age groups increased their rate of saving in the mid 2000s, likely driven by precautionary motives, lower expectations for future income growth and declines in wealth.[12] Over the following six years, households aged 35–44 years increased their rate of saving further while the rate of saving for older and younger households was relatively unchanged (Graph 8). While older households generally save less than younger households, older households still had positive savings over the past 15 years, on average.
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-08.svg" alt="Graph 8: Household Saving Ratio" width="620" height="516">
Since 2015/16, the aggregate saving rate in Australia has declined, as disposable income growth has been weaker than consumption growth. While distributional data on saving are not available for the past couple of years, historical experience suggests that demographics are likely to have contributed in some part to the further decline in the saving rate since 2016, as the share of older households, who save less, has increased. The relative increase in the saving rates of younger households over this time has mitigated this effect on the aggregate saving rate. A simple scenario that uses 2015/16 saving per household and population shares from 2003/04 suggests that in the absence of changes in demographics over this time, the saving rate would have been 1 percentage point higher in 2015/16. As the population continues to age this may weigh further on the saving rate.
Superannuation has also supported consumption by older households
Superannuation has played an important role in households' choices for smoothing consumption as they approach and enter retirement, giving them the option of drawing down their superannuation to fund spending above their income. The drawdown of super has supported older households to consume more on average (Graph 9).
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-09.svg" alt="Graph 9: Household Finances" width="620" height="593">
Growth in household consumption has been supported by strong growth in asset prices, particularly for older households
Past research has identified a relationship between household wealth and consumption.[13] Net wealth has increased for all age groups, although the largest gains in dollar terms have accrued to older households (Graph 10). The average Australian household's wealth – under the definitions in the national accounts – increased in nominal terms from around $500,000 in 2004 to close to $1.1 million in 2015/16. The average wealth of households aged 15–34 increased by around $90,000 over this period, while for households aged 55 and above it increased by $630,000. Older households have accumulated considerably more wealth than households of the same age in the past, consistent with the increase in their consumption.[14]
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-10.svg" alt="Graph 10: Net Wealth by Age" width="620" height="439">
Housing wealth increased strongly from 2003/04 to 2017/18, but debt owed by households grew even more strongly. While households aged 65 and above hold the least debt on average, these households (and those aged 55–64) have also seen a trend increase in the average housing debt per household relative to households of their age in the past, meaning that older households are now approaching or in retirement with more debt, on average (Graph 11).
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-11.svg" alt="Graph 11: Real Household Debt" width="620" height="552">
The growth in housing wealth and debt in part reflects increased ownership of investment properties by older households. For older households, housing debt is roughly evenly split between owner-occupied and other properties, while for households aged 54 and below housing debt is largely for the property they live in. Data from the Australian Taxation Office indicate that increased ownership of investment properties over the past two decades has been driven by those aged 50 and above (Graph 12).
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-12.svg" alt="Graph 12: Residential Rental Properties" width="620" height="539">
Social welfare has also supported consumption by older households
Households across all age groups are supported by sizeable social transfers from the state. Consideration of these public transfers gives a more complete picture of the set of resources available to households and helps explain the relatively resilient private consumption of older households because private income and consumption has been supplemented by support from the state.
Social assistance income provided to households aged 65 and above has increased around 30 per cent in real terms over the period 2003/04 to 2017/18 (Graph 13). Pension income has grown in excess of both the consumer price index and the wage price index since 2003, partly reflecting a number of policy changes.[15] Social assistance income declined a little in 2017/18 for older households, on average. This seems to reflect, at least in part, a larger share of part pensions.
Growth in nominal social assistance income has been subdued for all other households since 2003/04; in real terms, it has declined a little. The typical household aged 64 and below receives no social assistance income from the state. While unemployment benefits did increase a little towards the end of the mining boom, these only account for 15 per cent of social assistance.
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-13.svg" alt="Graph 13: Social Assistance Income by Age" width="620" height="556">
Once other transfers, such as child care and education benefits (for example, subsidies for education), are included, the social welfare benefits are a little more evenly distributed across age groups in nominal dollar terms (Graph 14). These ‘transfers in kind’ also include aged care and benefits received through the National Disability Insurance Scheme. Social transfers in kind are captured by measures of government spending and are not included in household consumption growth. Total spending on these transfers has grown significantly over the past 15 years, which has been an important driver of growth in public consumption and economic activity.
<div> </div>
<img src="https://www.rba.gov.au/publications/bulletin/2020/mar/images/graph-0320-8-14.svg" alt="Graph 14: Social Welfare Benefits by Age" width="620" height="497">
Conclusions and considerations for the outlook
Australia, as in many countries, is experiencing large demographic shifts. Some portion of the slowing in aggregate consumption and household disposable income growth over the past decade is likely because of demographic changes as more households have moved into a stage of their lives where they earnt and spent less, on average. These effects have been smaller than what previous patterns of household spending would suggest because older households are spending more than in the past. This expenditure has been supported by relatively strong growth in income, large increases in wealth and withdrawals from superannuation.
Over the coming decade, a further strong increase in the share of households aged 65 and above is expected. Further impacts on consumption and income are likely, although these are likely to happen over a number of years. The increase in young overseas migrants over the past decade should support the share of the population that are of working age over the coming decade. This has made Australia relatively well placed, compared with many other advanced economies, to adjust to the effects of an ageing population.
TOMAS COKIS AND KATE MCLOUGHLIN are staff at the RBA
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