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Aussie household wealth drops: $500b wiped

People crossing the street and Australian money notes
Household wealth has dropped amid cost of living pressures and rising rates. (Source: Getty)

Household wealth has dipped for the first time since the start of the pandemic. It comes as Aussies face cost of living pressures and rising rates.

Almost $500 billion was wiped from Aussie households in the June 2022 quarter, according to figures released by the Australian Bureau of Statistics (ABS).

Falling superannuation balances and property prices contributed to the 3.3 per cent drop, head of finance and wealth at the ABS, Katherine Keenan, said.

"Falling superannuation balances contributed 1.7 percentage points to the 3.3 percent decline in household wealth. This reflected the large price falls in domestic and overseas share markets," she said.

Weak residential property prices contributed 1.1 percentage points to the drop in household wealth.

How much is the average Australian worth?

The average Australian is now worth $553,954, a fall from $574,807 in the March quarter, ABS data found.

Despite the overall fall, the ABS noted that household deposits grew by 0.5 per cent ($7.4 billion) during the quarter.

Households have accumulated $311.9 billion in currency and deposits since the beginning of the pandemic.

Demand for credit still high

Demand for credit remained high with a $39.7 billion increase in housing loans for households.

"Household demand for credit was the second highest on record, reflecting ongoing activity in the property market for both owner occupier and investor loans," Keenan said.

It comes as mortgage owners brace for a sixth consecutive rate hike.

The Reserve Bank is meeting on Tuesday and is expected to raise rates by between 0.25 and 0.50 percentage points.

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