Which is Australia's top-performing economy?

South Australia has secured the top spot on the State of the States leaderboard, while one of CommSec’s quarterly report’s measures showed that Queensland defended its first rank for home loans.

Australia’s top-performing economy

For the first time ever in the 15-year history of CommSec’s report, South Australia was recognised as the nation’s top-performing economy, with the state’s robust construction activity and a thriving job market propelling it to the forefront of Australia’s economic landscape.

Craig James (pictured above), CommSec’s chief economist, said South Australia has excelled in four key economic indicators – real economic growth, unemployment, construction work, and dwelling starts.

This outstanding performance allowed South Australia to surpass Victoria, which now shares the second position with New South Wales. Western Australia climbed from fifth to fourth place, while Tasmania ascended from sixth to fifth. The Australian Capital Territory (ACT) moved into sixth place, outpacing Queensland, which dropped three places to seventh. The Northern Territory secured the eighth position.

“The economic performance of Australia’s states and territories is being supported by a solid job market and strong population growth however the economies have slowed in response to rising interest rates, higher borrowing costs and price pressures,” James said in a CBA media release.

South Australia's rise to the top is attributed to a tripled population growth over the past two years, reflecting a robust housing market and overall economic activity.

Despite this historic achievement, James warned that challenges may arise as New South Wales and Victoria remain competitive in the period ahead.

Top for home loans

The CommSec report also said Queensland emerged as the leader in home loan commitments.

The measure, comparing the trend value of owner-occupier housing finance commitments (excluding refinancing) with the decade average, not only indicates real estate activity and housing construction, but also is a useful indicator of financial sector activity.

Home loans in Queensland surged by an impressive 24.6%, surpassing the long-term average. This robust growth solidifies Queensland's position as a key driver of housing finance activity. This was followed closely by South Australia (22.6%), Western Australia (19.8%), and Victoria (17.3%).

Housing finance commitments in all states and territories, excluding the Northern Territory, continue to surpass decade averages. The Northern Territory stands as the weakest performer, experiencing a 3.7% decline in housing finance commitments compared to its decade average.

Other CommSec report highlights

• South Australia ranked first on four indicators, including construction work done and unemployment.
• Victoria ranked second or third on three of the eight indicators, including retail spending.
• New South Wales also ranked second or third on four of the eight indicators, including unemployment.
• Western Australia led in relative population growth.
• Tasmania secured the top position on equipment spending.
• The ACT claimed the first spot in retail spending.
• Queensland topped the charts on home loans.
• The Northern Territory ranked second on relative population growth.

Annual Growth Rates

Annual changes in economic indicators showcase economic momentum.

• Western Australia maintained the strongest economic momentum, consistent with the October 2023 survey ranking.
• Queensland secured the second position, followed by Victoria in third, and New South Wales in fourth.
• South Australia claimed the fifth position, with the Northern Territory, the ACT, and Tasmania in sixth, seventh, and eighth positions, respectively.
• Western Australia led in annual growth rates on three indicators, while the Northern Territory led in two. South Australia, Queensland, and the ACT led in one each.

To read the CommBank media release, click here. You can also download the State of the States complete report.

Get the hottest and freshest mortgage news delivered right into your inbox. Subscribe now to our FREE daily newsletter.