This week’s market report covers three key topics: the market wrap, “Is that a bubble” and the World Wealth report on who is a Millionaire and how they accomplished the coveted milestone.
The Melbourne market built on the gains it made from the previous weekend with a robust clearance rate of 81%, marginally up from 80%.
It is interesting to dissect the auction results with 485 of the 715 reported auctions sold on the day while another 100 sold before the auction. The higher the number sold before auction, the lower the vendors’ confidence that the desired price will be achieved. Just 2 properties were sold after auction, leading to the conclusion that if the property was priced right, it sold.
Another good day for sellers and the robust Melbourne market continues.
Is that a Bubble?
The media is hyping up “bubble” talk, a topic WBP Property Group addressed in a recent blog. Being Australia's third largest bank valuer it is well placed to make a call on the subject. It’s view is that while the market is strong it isn’t in bubble territory because demand is supported by continued population growth (immigration), a shortage of established property and continuing record low
interest rates, none of which are expected to abate in the short term.
Who is a Millionaire?
The latest World Wealth report makes for some very interesting reading as it compares the profiles of Australian Millionaires to their global counterparts. But let's start with the profile of an Australian millionaire.
There are 266,400 millionaires of which 75% are male while 25% are women. Globally, 47% of millionaires earn their wealth through business ownership while here in Australia the percentage is only 33%. Interestingly, the highest concentration of millionaires in Australia built their wealth from their salary and bonuses – about 42% have made their wealth from this source compared to just 23% globally.
It seems younger Australian millionaires sought the fast road with a strong appetite for entrepreneurship especially in the online and digital ways of doing business.
Real estate in Australia has featured prominently in millionaires investment preferences with more than a third building their empires through property investment. Investment in the stock market also features prominently making up a significant 30%.
It is interesting and important to note that 39% of male millionaires seek professional financial advice while the number among women is even higher at 46%. Taking risk is also a key wealth creator.
Australia has the key ingredients to achieve millionaire status, highly paid work, a deep affinity with property and a willingness to take the risks required to achieve the financial rewards it brings.