As the holiday season approaches, Australians are making adjustments to their spending habits due to increasing living costs. The latest CommBank iQ Cost of Living Insights report reveals that spending has grown by only 1.5% over the past year, lagging behind inflation. This data highlights significant differences in spending patterns across generations and regions.
Young Australians, aged 18–29, have reduced overall spending by 2%, cutting back on both essential and discretionary expenses. Those aged 30–39 have also reported declines, while older Australians have increased their spending, with those over 70 recording a significant rise of 7.7%.
At the regional level, spending in non-metropolitan areas has grown by 2.2%, outperforming metro areas at 1.3%. Western Australia and Queensland are leading with higher spending growth, while Victoria has recorded the lowest growth at just 0.4%.
➤What Is the Impact?
These trends highlight a stark divide in financial flexibility between younger and older Australians. Rising costs are creating challenges for younger people, including saving for major milestones like buying their first home. Older generations, with greater financial security, are showing more confidence in their spending habits.
➤Regional trends reveal opportunities and challenges in different housing markets:
- Western Australia: Spending growth of 3.1%, driven by leisure and travel, reflects strong economic confidence. This is a promising sign for the housing market, which could offer stability and potential for long-term value.
- Queensland: Spending has increased by 3.9%, supported by government concessions such as energy relief and discounted public transport. This indicates optimism in the region, with favorable conditions for buyers and investors.
- Victoria: With spending growth at just 0.4%, households are focusing on essential purchases. This cautious behavior reflects a reserved housing market outlook, making it important to approach property decisions thoughtfully in this region.
➤Insights for Property Buyers and Investors:
Western Australia and Queensland stand out as regions where consumer confidence and spending habits suggest potential resilience in the housing market. For those considering property investments or buying a home, these areas may offer opportunities for steady growth.
In contrast, Victoria’s slower spending growth underscores the importance of careful financial planning. Buyers in this region may need to prioritize properties offering long-term value over short-term gains.
For more insights into property opportunities across Australia and tips on how to adapt to current financial trends, explore related articles on our website.
If you’re seeking advice tailored to your financial situation, consider scheduling a consultation with ASK Financials today!
