Figure 3: Declining interest rates and increasing debt levels  Source: Stats NZ, RBNZ calculations. Household debt as a proportion of disposable income has risen from 60 percent in the early 1990s to 166 percent across all households, and for households with mortgages, the increase is even larger (Figure 4).
Figure 4: Debt to disposable income ratio in New Zealand  5  Source: Stats NZ, RBNZ Household Assets and Liabilities Survey, RBNZ estimates. It’s important to remember that while extremely low interest rates have been commonplace in the developed world for over a decade now, New Zealand’s very low interest rate environment is a more recent phenomenon.