In the end, a lot more of our income is devoted to housing, acquired by servicing mortgages, than was once the case. The question is whether this long period of gearing up by households might now be approaching an end. Certainly household credit growth is much slower at present than it has been for some years, running roughly in line with income growth.
Might we see this conservative approach to debt among households persist? It is hard to know the answer to this question. There is much more of the household balance sheet that could, in principle, be turned into collateral, so gearing up might resume once the current turmoil has passed.