Australians are ploughing their cash into travel, entertainment and real estate as the country well and truly moves past the COVID-19 recession.
That's the finding from the latest Commonwealth Bank of Australia (ASX: CBA) Household Spending Intentions (HSI) survey that analysed spending in March.
The rebound in consumer activity matches the bank's economists' forecast that Australia would return to pre-pandemic growth levels by the first quarter of this year.
"The stronger Household Spending Intentions report is another signal that Australia's economic recovery is ongoing," said CBA chief economist Stephen Halmarick.
CBA economists expect Australia's gross domestic product to grow 4.7% this year, while the unemployment rate drops to 5%.
The HSI each month combines the bank's customer behaviour analysis with Google Trends data to form a view on where Australians want to spend their money.
Image source: Getty Images
Australians want to travel
The ban on international transit and localised lockdowns have Australians clamouring to travel again.
The sector saw the biggest year-on-year jump in spending intentions in the March survey.
"The travel sector was among the hardest hit by the onset of the COVID pandemic, with border closures and a country-wide lockdown stifling nearly all travel-related activity," Halmarick said.
"This month's data, while distorted by base-effects, still demonstrates how far the sector has recovered since last year."
The 12 months to March saw local facilities like amusement parks, aquariums, hotels, motels, resorts and motor homes attract increased interest. However, the annual pace of spending went backwards for air travel, cruising, timeshare accommodation, travel agents and coach lines.
Australians want to be entertained
The entertainment sector also enjoyed a big jump in interest and patronage in the month of March.
"A year ago, bars, clubs, restaurants and movie theatres wrangled with the swiftly escalating restrictions in the lead-up to a country-wide lockdown," said Halmarick.
"This March, the picture for this sector is much improved, as pent-up demand among consumers helped spur both actual and prospective spending on the category."
Within the sector, bars, restaurants, fast food outlets, boat rentals, bowling alleys, cable TV, movie theatres, dance halls, studios and schools, digital books, movies and music, and musical theatre venues fared the best.
Australians want real estate
It's already been well-publicised that the residential real estate market has been soaring the past 6 months.
The HSI confirms this, with spending intentions for property hitting an all-time high. Home loan applications and Google searches for homes skyrocketed in March.
Halmarick said near-zero interest rates were to blame.
"We continue to see demand for residential property as a key source of support for the Australian economy in 2021."
The CBA previously forecast that residential real estate prices would be up 8% nationally this year then another 6% in 2022. House prices alone are expected to end up 9% higher by the end of the year.
