Record improvements for homeowners

Record improvements for homeowners

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Rising property prices have delivered a windfall to Australians who have paid off their mortgage.

Financial conditions improved by 2.6 per cent between the September and December quarters, according to a survey of 1,200 Australians by St George Bank and the Melbourne Institute.

However, the increase was significantly bigger for people who wholly own their home, with their financial conditions jumping by 15.4 per cent – the biggest quarterly rise since the report started 20 years ago.

St George retail banking general manager Andy Fell said the booming housing market has helped improve the quality of life and financial position of mortgage-free Australians.

"The report is broken down by occupation group and the big winners were tradespersons and para-professionals, who recorded the biggest jump with a 21.5 per cent rise in December," Mr Fell said.

"The financial conditions for this group are at the highest index reading in five years and are most likely due to the rising supply of housing and the demand for construction work."

Although some groups are doing well, St George chief economist Besa Deda warned that overall consumer confidence remains fragile and that many households are concerned about their debt.

"The number of respondents who said they would pay down debt with new savings rose by 3.9 percentage points to 17.6 per cent of all households in December," she said.

"This is the highest proportion in almost two years and the biggest quarterly percentage rise in three years.

"The findings also show Australians are quite the savvy savers, with just 2.2 per cent of households reporting no savings in December, not far from the historic low recorded in June last year."

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