have housing debt other than debt on their own primary residence. in this graph, we have split up the share of people who have any housing debt into those who have only debt on their own home, and those who have some other kind of housing debt ; most, but not all, of this second group also have owner - occupier debt. as you can see, this other property debt is even more likely to be held by high - income earners than owner - occupier debt is. the pattern of rising ownership rates for older age groups does not give everyone comfort that most people will be able to afford a home eventually. people worry that it is becoming harder to achieve home ownership at a given life stage than it used to be. this would be an issue of inequality across cohorts. it is true that home ownership rates have fallen for most age groups over time ( graph 5 ). the overall ownership rate has stayed fairly steady because the population is ageing. it is also true that ownership rates shifted down between 2006 and 2011 ; we ’ ll know what happened in 2016 when the census data come out in a few months. the 25 – 34 age group is typically seen as the core group of first home buyers. we can see that ownership rates in this group have fallen by a bit more than 10 percentage points since the 6 / 12 bis central bankers'speeches 1970s. but we can also see that most of the decline had already happened by the early 1990s, before the big increase in housing prices relative to incomes. what changed during that earlier period was that people started partnering and settling down later in life. the post - war baby boom had been characterised by an anomalously young average age at first marriage. through the 1970s and 1980s, the normal historical pattern started to reassert itself. ownership rates for young people declined as a result, because many people wait to settle down before they buy a home. by saying this, i ’ m not suggesting that people should not worry about whether households can achieve their desired housing tenure. i am suggesting that the situation is more complex than would be suggested by a single - minded focus on a single metric of affordability, such as median housing prices. much of the commentary around the difficulty of achieving home ownership centres on the task of accumulating the deposit. it seems common to assume that everyone needs a 20 per cent deposit when they first buy. this isn ’ t actually true : although lenders require some deposit

for a number of purposes, a credit - based rate is completely appropriate. however, for other purposes, a rate that is closer to risk - free may be more appropriate. for instance, in recent years, market participants have moved to use overnight - indexed swap ( ois ) rates more often when discounting the cash flows in their swaps. the fsb, through its official sector bis central bankers ’ speeches steering group ( ossg ) on benchmark reform, is encouraging market participants to contemplate switching from credit - based benchmark rates like bbsw or libor to risk - free rates, where appropriate. in the local market, there appears to be growing interest in using risk - free rates as benchmarks. such a rate could be backward looking, like the cash rate, or forward looking, like ois rates. as a first step, some market participants have indicated that a total return index of the cash rate would be a useful backward - looking benchmark. implementing this would be straightforward, since the rba already calculates and publishes the cash rate. some market participants are also interested in referencing a forward - looking rate with equivalent tenors to bbsw, and we will continue to work with afma on the development of such a benchmark. one example where a change in reference rate could be contemplated is for floating rate notes ( frns ) issued by governments. frn coupon payments are typically priced at a spread to bbsw. while referencing bbsw makes sense for frns issued by banks, it is less clear why governments should tie their coupon payments to a measure of bank funding costs. that is one example worthy of consideration. there are a number of others. i know this is not necessarily an issue you may have thought that much about until now. at the very least, i would encourage you to at least ask the question whether the product you are issuing or holding is using the most appropriate reference rate. conclusion let me conclude. interest rate benchmarks such as bbsw are a very critical part of the plumbing of the financial system. market participants need to have confidence in their robustness and integrity. to help ensure that is the case, the cfr has undertaken a consultation process on the bbsw methodology. the industry, working through afma and with the cfr, will need to act on these proposals to ensure that bbsw remains a trusted, reliable and robust financial benchmark. bis central bankers ’ speeches