They have shown a couple of cycles over the period shown in the chart, rising in the late 1990s and again in recent years, but these cycles have taken place around a flat trend. Mortgage interest rates today are much the same as they were around 1996-1997.
We are therefore left with the conclusion that the decline in measures of housing affordability since the mid 1990s is almost entirely due to the rise in house prices relative to incomes. 4  BIS Review 49/2009  3. Arrears  Housing loan arrears are the most tangible indicator of the extent to which households are getting into difficulty with their housing loans.