Arrears levels among the collateral loans underlying Australian prime residential mortgage backed securities are some of the lowest in the world, according to Standard & Poor's Ratings Services. Loans in arrears greater than 30 days for prime RMBS decreased by 4 basis points to 1.18 per cent in March, on total volume outstanding of about A$116.7 billion.S&P reported that new RMBS issuance reached $8.9 billion in the first quarter of 2014, a level of activity that "compares favourably" to other major RMBS markets.The state of the Australian housing market was also picked up in a wide-ranging discussion by experts at the mid-sized equities investment firm Alphinity, as part of its analysis of the Australian banks' earnings cycle."While house prices, valuations and affordability can be debated ad nauseam it is worthwhile keeping in mind that the aggregate five capital city house prices have increased annually by only around 4.5 per cent over the last decade," the report noted."The biggest Australian property market of Sydney has barely kept pace with inflation growing at 3.2 per cent annually over the last decade," noted the report.