Future outlook enhanced by Google Trends

The Commonwealth Bank Household Spending Intentions (HSI) series for July 2021 clearly shows the impact of the extensive lockdowns in place across Australia, with declines for Home Buying, Retail, Travel, Entertainment, Education and Motor Vehicle spending intentions. Health & Fitness spending intentions continued to improve. Through H2 20 and H1 21, Australia’s economic recovery was impressive, as reflected by the sectors of the economy represented by the Household Spending Intentions series. However, all this has changed in July and, unfortunately, the spread of the delta variant of the COVID-19 virus has seen a combination of rolling lockdowns used across much of Australia and the extended lockdown in Greater Sydney.

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New perspectives can keep you one step ahead

Whether you are running a business, a policy maker, an investor or one of Australia’s corporate enterprises - insights on shifting consumer spending intentions are critical in planning for the future. Our Household Spending Intentions series combines our spending data, one of Australia’s largest financial data sources, with Google Trends publically available search activity. By connecting actual spending data to intentional data, our analysis provides an early indication of prospective spending trends across seven key sectors. This series covers about 55% of the total household spend. Future releases will look to expand our coverage to the  remaining spending components.

Data-driven insights can give your organisation a new perspective and help you keep a step ahead.

Home Buying Spending Intentions

Home buying spending intentions

  • Home buying spending intentions were lower in July 2021 relative to July last year, but higher relative to July 2019
  • The medium-term improvement in home buying spending intentions looks to remain in place and is being driven largely by an increase in home loan applications
  • With interest rates low, and now expected to stay lower for even longer, home buying intentions are likely to remain elevated and this is expected to keep upward pressure on house prices. Indeed, we now expect dwelling prices to rise by 20% in 2021 and then a further 7% in 2022

Retail Spending Intentions

Retail spending intentions

  • Retail spending intentions declined further in July 2021 relative to July last year. Retail spending was, however, stronger than in July 2019
  • Relative to last year, Retail spending was lower in July 2021 for clothing & footwear (across almost all categories), duty free stores, household furnishings & equipment (including furniture, floor coverings, glass, paint and household appliances), jewellery & watch stores, luggage & leather goods stores, barber & beauty stores, cosmetic stores, health & beauty spas, book stores and hobby, toy & games stores. Lockdowns in various states and closure of all but essential retail stores was a big impact
  • Increases in July 2021 relative to July 2020 were seen for; Food & non-alcoholic beverages, department stores, hardware equipment and supplies, digital apps, electronic stores and pet shops with these shops largely remaining open during lockdowns

Motor Vehicles Spending Intentions

Motor vehicle spending intentions

  • Motor Vehicle spending intentions declined in July to be close to the same level as in July 2020. Relative to July 2019, spending on motor vehicles through the CBA network are down, while Google searches are also lower
  • Generally speaking, prior to the current phase of lockdowns spending intentions on motor vehicles had been strong through the first half of 2021. This has been supported by changed transport preferences and the wealth effect from rising house prices

Entertainment Spending Intentions

Entertainment spending intentions

  • Entertainment spending intentions continued to shift downwards in July 2021 relative to July last year – as base effects from 2020 impacted on the data, as well as the renewed lockdowns
  • Relative to July 2020, there were increases in spending on: eating out & restaurants, fast food restaurants, cable & pay TV, digital books, movies, games & music, movie theatres and musical theatre
  • These increases were offset by declines in spending for on-premise alcohol, boat rentals, bowling alleys, music stores and video arcades
  • Relative to June 2019, Entertainment spending is up, with increases in off-premise alcohol, eating out & restaurants, fast food restaurants, cable and pay TV and digital books, movies, games & music. Declines are evident in spending on dance studios, movie theatres, musical and live theatre and video arcades

Travel Spending Intentions

Travel spending intentions

  • After recovering in recent months, not surprisingly Travel spending intentions declined in July 2021 relative to July last year and are substantially lower against July 2019
  • Relative to July 2020, Travel spending was higher in July 2021 for airlines (off a low base), amusement parks, motor home and RV rentals, sport and recreation camps, tourist attractions, travel agencies, car rentals and bus lines. Declines in July 2021 were seen in aquariums, camper & RV rentals and timeshares
  • Against July 2019, travel spending intentions for July 2021 are well down. This includes big falls for: airlines, amusement parks, hotels & motels, sport & recreational camps, cruise ships, timeshare, tourist attractions, travel agents, car rentals and bus lines

Education Spending Intentions

Education spending intentions

  • Education spending intentions turned down in July 2021 relative to July last year, but remain at relatively elevated levels. Actual spending in education was higher on the year, but with Google searches a little lower
  • The number of education related transactions were higher in July 2021 relative to both July 2020 and July 2019. The largest decline in the number of educations transactions relative to 2019 is in university, colleges & professional schools, with the biggest increase in elementary and secondary schools
  • The value of education transactions is down relative to both July 2020 and July 2019 – with significant falls since 2019 in business & secretarial schools, colleges & universities, trade & vocational schools, correspondence schools and elementary & secondary schools

Health and Fitness Spending Intentions

Health and fitness spending intentions

  • Health & Fitness spending intentions remained strong in July 2021, compared with both July last year and July 2019
  • Relative to July 2020, Health & Fitness spending intentions were up for: doctors, hospitals, medical labs, nursing & personal care, orthopaedic and osteopaths. In the Fitness category spending increases were seen in commercial and professional sports and club memberships and public golf courses
  • Compared with July 2019, Health & Fitness spending intentions remain very strong. In the Health sector, the largest increases in spending have been for: osteopaths, chiropractors, doctors, dentists, podiatrists and orthopaedic goods. In the Fitness sector, the largest increases have been in bicycle shops and service, public golf courses and sporting goods stores. Commercial/professional sports spending still remains well below the levels of July 2019

Enhanced by Google Trends

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