That's according to Commonwealth Bank's (CBA) latest Household Spending Intentions (HSI) series, which shows intentions to buy a home are at its highest level since 2015.
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Based on CBA's analysis of Google searches and trends, as well as home loan applications, it expects the housing market to continue to be a key source of support for the economic rebound in 2021, thanks mainly to ultra-low interest rates.
That's while house prices are rising by the highest margin in 17 years, which are now beginning to weigh on otherwise expanding consumer confidence.
This is likely to continue, with CBA and also Westpac predicting house prices rises of 16% and 20% over the next two years respectively.
Indeed, retail spending intentions softened in February 2021, despite recent rebounds in actual turnover figures.
CBA saw strong increases in spending in a range of consumer goods, including clothing, groceries, furniture, digital apps, electronics, hobbies and toy stores, pets and more.
Weaknesses however were seen in dry cleaners and tailors, while travel spending intentions remained largely unchanged.
Weakness is still evident in spending on airlines, cruise ships, hotels & motels, timeshares, travel agents, car rentals and bus lines, although CBA expects the recent half-priced flights package (announced after these results were taken) to boost this spending.
Overall results were mixed across the seven categories tracked, which also includes Motor Vehicles, Entertainment, Education, and Health and Fitness.
“Fourth quarter data showed that economic growth improved further at the end of 2020, with a “V-shaped” recovery and we now expect that the Australian economy will grow by 4.4 per cent in 2021,” CBA Chief Economist Stephen Halmarick said.
There were some interesting data points in this month's HSI release that occurred due to the changed landscape from COVID.
Car buying intentions for example are lower than February 2020, despite a modest increase last month, as the trend of working from home reduces the need to commute.
Entertainment spending meanwhile has increased substantially from 2020, not just on in-home entertainment like TV services, but in outdoor services as well like restaurants, movies and bowling alleys.
See also: Vehicle purchases increase 31.8% in December 2020
CBA HSI data for (top left to bottom right): Home buying, retail spending, motor vehicles, and travel.
Image by Agover from Pixabay
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