The South African bond market is well developed in the sense that it is not only dominated by financial institutions and the government, but also comprised of a large number of non-financial corporates, while the maturity extends beyond 30 years.
But this ratio can adjust in several ways: lower house prices, rising incomes or falling interest rates. In the US, falls in house prices have been a big part of the adjustment. I think there are reasons, however, to believe that the Australian housing market will not follow the US market to the same degree. Let me run through some of these reasons.