Household wealth of Australians 'up 50%'

The average net wealth of Australian households increased by around a half between 2002 and 2006, a new report has found.

According to news.com.au, the Melbourne Institute Survey of Household, Income and Labour Dynamics in Australia put the net wealth of the average Australian household at $608,000 in 2006 - compared to $401,000 in 2002.

The country's soaring property prices were the main factor behind the rise, the site said.

However, it added, since 2006 Australian interest rates have hit a 12-year record high, inflation is at a 16-year peak and petrol prices are edging closer to $2 a litre - meaning Australians are paying much more for their higher cost of living.

The survey's deputy director, Roger Wilkins, said: "One would be reasonably confident that that growth hasn't continued in the past 18 months."

Nevertheless, Mr Wilkins said the survey indicates that the growth experienced between 2002 and 2006 was not confined to the richest end of society. Instead, it saw wealth increasing across a wide section of society.

According to another recent survey by brokerage firm CommSec, the average Australian is still better off than they were in 2002 - to the tune of $425 a month.

And CommSec chief economist Craig James said despite higher living costs, rising wages means it is "by no means the rule" that most Australians are struggling with their finances.

"Living costs have certainly been rising, but so have wages," he said.

Mr James added that despite the downturn in consumer spending, people would "filter back into the shopping malls" once they realise they can still afford to spend.

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