A direct measure targeted specifically at the housing market may have a place among prudential tools that could be used in New Zealand in the future, the Reserve Bank of New Zealand believes.Such a measure that could take the form of a restriction on loan-to-value ratio and is among the small number of tools that the RBNZ thinks can be used in New Zealand. The others include adjustments to the core funding ratio, the use of counter-cyclical capital requirements and adjustments to capital risk weights for particular sectors.The core funding ratio is already in use but the RBNZ is exploring if the ratio can be made flexible to change according to the credit cycle and to promote financial stability. In case of capital risk weights for certain sectors, the RBNZ is already in discussion with banks to raise their risk weights on rural lending.A more direct tool targeted at the housing market is something the RBNZ previously showed no inclination towards. In the last Financial Stability Report, the RBNZ had noted that a number of South East Asian and emerging market economies have employed a range of prudential tools including limits on loan-to-value ratios. The RBNZ, however, didn't indicate then whether it favoured the use of such a measure in New Zealand.Separately, the RBNZ signalled it may delay the full implementation of the increase in the core funding ratio to 75 per cent from the current 65 per cent. The Bank plans to raise the minimum core funding ratio to 75 per cent over the next two years, the RBNZ said. Previously it said the full implementation will be completed by mid-2012. Currently, banks are comfortably meeting their minimum CFR requirement and most of them are in the region of 70-75 per cent.