Wealth is up but ABS warns more than 400,000 Sydneysiders are 'over-indebted'
Soaring house prices have lifted the wealth of the average Sydney household to $1.3 million, but hundreds of thousands of families in the city have been left "over-indebted".
The Bureau of Statistics' latest survey of income and wealth has classified 407,000 Sydney households with property loans as over-indebted, meaning they owe at least three times more than they earn in year. The typical over-indebted household in Sydney is carrying a hefty $765,400 in total property debt.
"Growth in debt has outpaced income and asset growth since 2003-04," the bureau said. "Rising property values, low interest rates and a growing appetite for larger debts have all contributed to increased over-indebtedness."
Over-indebted households are more vulnerable to economic shocks, such as rising interest rates, the loss of a job or a drop in asset prices.