Ellis speaking at the 2017 Australasian Housing Researchers
- Says most domestic mortgage debt held by those most able to service it
- Need to be aware of pockets of potential mortgage stress in otherwise benign debt picture
- Australia home ownership rates neither high nor low by international standards
- Housing policy should focus more on security of tenure, than ownership status
- Housing situation more complex than suggested by single-minded focus on median prices
Quick Headlines via Reuters
Debt servicing issues are relevant for their impact on household spending, a high debt load can reduce household spending on goods and services, which has wider implications for the economy.
From Ellis' remarks its not seemingly a concern at present ("most domestic mortgage debt held by those most able to service it" ... "pockets of potential mortgage stress in otherwise benign debt picture".
You may be tempted to make the point, "But what if the situation changes and ability to service debt declines? What then?", and that's a good point.
So, watch the data. Its tempting to pre-empt the worst (it's a thriving industry here in Australia, plenty of doom and gloom to sell newsletters and such ... but its been wrong for decades). Watch the data.
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Luci Ellis is the Assistant Governor (Economic) at the Reserve Bank of Australia
