Debt-to-assets down but debt-to-income up

The increase in residential property values over the past year has helped reduce debt-to-income ratios, while low interest rates have cut into interest payment-to-income ratios.

However, the latest Reserve Bank household finance figures show that debt-to-income ratios have begun rising.

The ratio of household debt to household assets was 16.7 per cent in the March 2014 quarter - down from 17.3 per cent a year earlier and 18.1 per cent in March 2012.

Housing debt to housing assets has fallen from 29.4 per cent to 28.1 per cent over the 12 months to March.

The ratio of household interest payments to household disposable income fell from 9.5 per cent to 8.8 per cent. Housing interest to household disposable income fell from 7.7 per cent to 7.1 per cent.

The ratio of household debt to household disposable income rose from 146.1 per cent to 149.9 per cent over the same period. And housing debt to household disposable income rose from 131.7 per cent to 135.8 per cent.