Australia Dollar
Pixabay

One in eight people in Australia are millionaires, a recent Finder research revealed, making it one of the highest percentages globally.

This figure is expected to rise sharply in the next five years. It's interesting to note that a significant percentage of Australian millionaires have attained this position just as a result of their homes' increasing worth, rather than via investments or commercial endeavors.

This demonstrates the substantial influence that Australia's real estate market has on the people's wealth, with the average household having a net worth of AU$1.58 million, News.com.au reported.

According to the survey, 74% of a household's net worth is stored in real estate and super, the report indicated. Additionally, it discovered that investors were more likely to have a greater median net worth, save and invest a larger portion of their income, and practice frugal living.

Graham Cooke, the head of Consumer Research at Finder, said Australia's property market will remain robust, making it increasingly difficult for young people to achieve homeownership.

"The government incentivizes investment in property, which pushes up prices, and will mean that property will likely continue to remain a very expensive asset," he said, which meant the young populations will have to turn to banks for homeloans or seek help from their parents.

"Of course, this is a resource that is not available to everyone. If your parents never owned their home, it is even harder for you to afford one yourself," he said. "Having said that, a high-interest world does mean high interest on savings, making working towards saving a deposit a worthwhile focus."

"Young Aussies should keep an eye out for higher ongoing interest rates from the online banks for best returns."

Budgeting and regular investments were important practices for building wealth in Australia. Debt repayment and passive income streams were also important, particularly for high-net-worth individuals.

About 85% of Australian investors with over AU$1 million in net wealth have a passive income source, such as earning interest on savings, compared to 48% of non-investors.