With the recent financial market turmoil, the ratio of financial assets, including stocks and insurance, to household assets slipped to 56.07%, three percentage points lower than the end of 2020.
The Bureau of Statistics recently released data on China's household balance sheet in the third quarter.
OCBC Bank Chief Economist Lin Xiuxin said in an interview with the Union-Tribune that the strong and solid performance of the local real estate market has pushed up the share of real estate assets in household assets, while the global risk assets have been hit this year, slowing the growth of financial assets.
Statistics Bureau data show that, compared with the same period last year, household real estate assets grew 12.8% as of the third quarter of this year.
Among them, HDB assets grew by 10.37%, private housing grew by 14.84%.
Financial assets grew by only 2.73% year-on-year, with stocks and securities shrinking by 4.98% and life insurance falling by 8.92%.
Although the proportion of real estate assets rose to the highest level in more than five years, but still lower than the peak of the real estate market in 2011.
The Morning Post compiled data from the Bureau of Statistics showing that real estate assets accounted for slightly more than 50 percent of assets in the third and fourth quarters of 2011.
As for whether the real estate share will continue to climb in the future, the current market supply and demand situation continues to support rising prices, but down the road it depends on whether interest rates will climb further and whether the government will launch more cooling measures.
According to CIMB private banking economist Song Shengwen, much will depend on the direction of mortgage rates and home prices, the latter of which will depend on the outlook for the economy and job market, as well as whether China will continue to attract more safe-haven capital.
China's overall household assets grew 6.94% year-on-year in the third quarter, higher than the 3.12% increase in debt, resulting in a 7.52% increase in household net worth to 2.5058 trillion yuan.
On the debt side, home loans rose 3.72% year-over-year, auto loans fell 3.37% and credit card debt jumped 16.05%. Home loans accounted for 71.7 percent of total household debt.
Lin Xiuxin expects the economic outlook to be uncertain and the growth of household debt to slow down next. For example, she said that car ownership certificates are at a record high, which will sooner or later affect consumers' affordability.
Personal disposable income increased by 9.8% in nominal terms in the third quarter
On the other hand, the Bureau of Statistics recently released personal income data, personal disposable income in the third quarter of this year achieved 9.8% nominal growth, more than the 7.2% in the second quarter, mainly because of the increase in employees' salaries, as well as local households received higher GSTV cash benefits (GSTV-Cash).
Personal savings fell 3.3 percent, a smaller decline than the 13.3 percent drop in the second quarter. According to the Bureau of Statistics, this was due to a strong 17 percent increase in private consumption expenditure.
The personal savings rate improved, at 31.4 percent in the third quarter, up from 28.7 percent in the second quarter.
Lin Xiuxin said higher inflation may be one of the reasons for the decline in personal savings, "Even though we still buy the same amount of things, the prices are higher and we spend more." However, the savings rate has risen as employees' salaries have still managed to keep pace with inflation.
