Australians think putting new savings towards buying a house is a lousy idea, according to the latest Westpac-MI consumer sentiment survey for September.
This chart from the Commonwealth Bank — revealing the wisest place to put new savings according to the survey’s respondents — is eye-opening.
Only 10.5% nominated real estate this month, the lowest proportion since the survey began in 1973. That was only marginally ahead of shares as the best investment choice at 9%.
In comparison, over half of the respondents said that putting the money into a deposit, or using it to pay off debt, was the best option.
Investor risk aversion clearly remains at elevated levels, and now sentiment towards the housing market is also souring, potentially creating even more angst given it is the largest source of wealth for a majority of Australian households.
While there is nothing wrong with paying off debt or saving for a rainy day, today’s result suggests that consumer-led Australian economic recovery in the years ahead is anything but certain.
Indeed, if the best investment choice is seen as a bank deposit or to pay off debt, it hardly suggests that households are about to splash out on discretionary spending — quite the contrary.
Something to consider in the period ahead, especially should housing market conditions soften further.