With this renewed vigour building on the decade-long boom that preceded the crisis, the average level of house prices nationally now stands at nearly four-and-a-half times average household disposable income. This compares with an average ratio of three-and-a-half over the past quarter-century (Chart 6). Simple house price-to-rent comparisons also suggest elevated valuations (Chart 7).
11 Standard estimates of r* have declined between 2 and 3 percentage points over the past two decades. Some argue that the effective decline is even larger. 12 Incorporating a lower value of u* into policymaking  10  Powell (2018).