Let me begin by discussing different types of measure more generally, and then I will say a few words on the quantitative effects of household indebtedness. Put simply, we can say that there are two different ways to manage the problems on the housing market: either attempt to increase the housing supply in order to dampen housing prices, or dampen demand for housing and mortgages by making it more expensive to borrow, or simply limit how much households can borrow. In terms of measures which subdue demand, it is important to differentiate between measures which affect all loans, or the whole stock of credit, and measures which only affect new loans, or the flow of credit. But let us begin with measures which affect the supply of housing. An increased supply of housing could dampen price increases – but it would take time! Structural problems on the Swedish housing market are the main reason why housing construction has been unable to meet rising demand. An increased supply of housing is a central piece of the puzzle, as it can subdue the increase in housing prices, which would also help to limit household indebtedness. However, the quantity of housing is not the only significant factor in terms of household indebtedness. It is also necessary to review how we can exploit the current housing stock more effectively. The distribution between purchased and rented housing is significant.
Figure 12 The effect of an amortisation requirement on household indebtedness according to current proposals Per cent 220  220 Scenario without measures Amortisation requirements  210  210  200  200  190  190  180  180  170  170  160  160  150  150  140  140  130  130 05  10  15  20  25  Note. Broken red line shows an estimate of developments over the next 10 years without further measures. Shaded area indicates a feasible lower limit for when the risks are elevated in the economy. Broken yellow line shows an estimate of the effect of an amortisation requirement according to current proposals. Sources: Statistics Sweden and the Riksbank. A change to tax relief on mortgage interest could lead to a faster and more direct effect on household indebtedness, as it affects all borrowers. However, as a reduction in tax relief initially raises mortgage costs, it is likely that existing mortgage borrowers do not pay down their loans immediately. The effect on the total debt-to-income ratio therefore occurs gradually, even in the case of changes to tax relief. According to these calculations, it is only  19  A borrower with medium indebtedness in Sweden taking out a new mortgage, or increasing existing loans, only amortises at a rate which leads to the new loan being repaid in 56 years.