Australia has risen to the highest median level of wealth out of any developed country, according to new research from the global investment bank.
Credit Suisse’s Global Wealth Report found that the median wealth per adult in Australia was US$238,070, compared to US$173,770 in Hong Kong and US$171,620 in New Zealand. Belgium was the second-wealthiest country by median figures, with US$230,550 in wealth per adult.
Australia was also high up in the average wealth figures at US$483,760 per adult, behind the US on US$505,420, Hong Kong at US$503,340 and Switzerland on US$673,960. Australia also recorded the second-highest increase in average wealth per adult at US$65,700.
Credit Suisse Australia head of private banking Michael Marr said the number of wealthy individuals in the nation was set to increase given rising house prices and the economy’s gradual recovery from COVID-19.
“Almost one in 10 Australian adults (9.4 per cent) is now considered a (USD) millionaire. Over the next five years, the number of USD millionaires in Australia is expected to increase dramatically by 70 per cent, from 1,805,000 to 3,071,000, an increase of 1,266,000,” Mr Marr said.
“This will be driven by the ongoing performance of our two principal sources of wealth, housing and financial assets, underpinned by robust GDP growth. Looking forward, we need to be watchful of signs of inflation and an inevitable increase in interest rates and the knock on effect this will have on the housing market.
“The link in normal times between GDP growth and household wealth growth, combined with the expected rapid return of economic activity to its pre-pandemic time path, leads us to believe that wealth will grow at a fast pace over the next five years.”
Mr Marr added that the monetary policy response to the pandemic in Australia had helped buoy household wealth across the country.
“The RBA’s lowering of interest rates in conjunction with other Central Banks across the world was probably the biggest contributor to Australia’s performance in the Global Wealth rankings in 2020, fuelling equity and housing market increases across Australia,” he said.
“The rapid appreciation of the Australian dollar over 2020 also played a significant role in Australia’s position in the rankings.”
The report also found that Australia was currently home to 1.8 million millionaires in US dollar terms, and more than 3,200 individuals with a net worth of US$50 million or more.
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