Australian households now hold $19.2 trillion in net wealth and are entering the largest intergenerational transfer of assets in the nation’s history, with between $3.5 trillion and $5.4 trillion expected to change hands over the next quarter-century, according to new research that finds the country’s wealth is becoming increasingly concentrated among older Australians even as overall prosperity continues to grow.
The fifteenth report in The Balance Sheet research series audits every major store of Australian wealth, from housing and superannuation to businesses, farms, financial assets and intellectual property. It concludes that Australia has built one of the world’s wealthiest societies, but one where the path into wealth increasingly depends on housing ownership, compulsory superannuation and inheritance rather than wages alone.
Housing remains the dominant source of wealth. Residential property is now valued at $12.6 trillion, supported by $2.6 trillion in mortgage debt, leaving households with almost $10 trillion in housing equity. While Australians continue to own their homes with comparatively little debt overall, younger generations are entering the market much later than their parents. Home ownership among people aged 30 to 34 has fallen from 64 per cent in 1971 to 50 per cent in 2021, while financial support from the so-called Bank of Mum and Dad is estimated at between $22 billion and $71 billion a year, enough to rank among Australia’s largest mortgage lenders.
Housing remains the dominant source of wealth. Residential property is now valued at $12.6 trillion, supported by $2.6 trillion in mortgage debt, leaving households with almost $10 trillion in housing equity
The report argues that housing’s growing dominance has been offset by another, quieter revolution. Since compulsory superannuation began in 1992, retirement savings have grown into a $4.4 trillion system, now the fourth-largest pension pool in the world. Nearly half those assets are invested overseas, helping Australians accumulate about $4.5 trillion in foreign investments against $5.1 trillion of foreign investment in Australia. The report describes superannuation as becoming “the 21st-century answer to the 20th’s quarter-acre”.
Its findings also challenge popular assumptions about foreign ownership. While overseas investors own $5.1 trillion of Australian assets, the largest foreign investors are American institutions, followed by British investors, with China accounting for just 1.7 per cent of the total. It also notes that many privatised assets commonly viewed as foreign owned, including Sydney Airport, are substantially held through Australian superannuation funds.
The report’s central finding is that the ownership of Australian wealth is changing more through ageing than through foreign investment. Australians aged over 65 now hold almost $6 trillion, or 32 per cent of household wealth, compared with about one-fifth two decades ago. Around $150 billion was inherited during 2024 alone, with the Productivity Commission estimating total transfers will reach about $3.5 trillion by 2050, while JBWere projects about $5.4 trillion over the next two decades.
The average inheritance, about $125,000, arrives at a median age of around 50, meaning wealth is increasingly transferred well after first-home buying years
The average inheritance, about $125,000, arrives at a median age of around 50, meaning wealth is increasingly transferred well after first-home buying years. The report notes that inheritances increase absolute wealth gaps but can reduce relative inequality because lower-wealth households receive proportionally larger gains.
Australia’s tax system is also entering a period of change. The report notes that the Federal Government’s proposed reforms to capital gains tax concessions and negative gearing represent the largest restructuring of wealth taxation in a generation, while redesigned taxes on superannuation balances above $3 million became law earlier this year. It also observes that Australia abolished inheritance taxes in 1979, leaving superannuation death benefits paid to adult children as one of the few remaining taxes applied when wealth passes between generations.
Australia remains one of the wealthiest countries in the world on median wealth per adult, with roughly one in ten adults a US-dollar millionaire. Yet wealth remains far more concentrated than income
On inequality, the report finds Australia remains one of the wealthiest countries in the world on median wealth per adult, with roughly one in ten adults a US-dollar millionaire. Yet wealth remains far more concentrated than income. The wealth Gini coefficient is roughly double the income measure, the top 20 per cent of households own about 63 per cent of total wealth, and the median outright homeowner holds around $1.3 million in net wealth compared with about $95,000 for renting households.
The paper also raises concerns about Australia’s ability to retain the wealth created by its own ideas. More than 90 per cent of patent applications lodged in Australia come from non-residents, national research spending remains well below the OECD average, and while companies such as Canva have remained Australian based, firms including Atlassian and Airwallex have shifted key corporate structures offshore. The report concludes that founders often remain in Australia, but enterprise value, intellectual property and future tax revenue frequently do not.
Looking ahead, the report presents three scenarios rather than forecasts. On long-term historical trends, household wealth could grow to between $62 trillion and $87 trillion by 2050. A 20 per cent fall in house prices would erase about $2.6 trillion in household wealth, while annual inheritances are projected to approach $500 billion in real terms by mid-century.
Its overall conclusion is that Australia has created extraordinary national wealth while making entry into that wealth progressively more difficult. Superannuation has broadened ownership across the population, but housing and inheritance are increasingly determining who accumulates wealth fastest.
Summing up its findings, the report concludes Australia has built a system that is “superb at compounding wealth for those inside it, and progressively slower at admitting anyone new”. It also argues the changing ownership of wealth should not be viewed as a failure of one generation, noting that as Baby Boomers retire and pass on their assets, “none of this is the Boomers’ moral failing; all of it is the system working precisely as designed. The design is the finding.”
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