Reflecting these developments in income and changes in the social structure, household disposable income had been sluggish after reaching its peak in 1998, but finally started to improve from the first half of the 2010s.
As a result, the average household mortgage debt-to-income ratio has risen from around 120 per cent in 2012 to around 140 per cent at the end of 2017 (Graph 2, left panel). Furthermore, the increasing popularity of interest-only loans over recent years meant that by early 2017, 40 per cent of the debt did not require principal repayments (Graph 3).