Households in Australia have high debt levels compared to historical figures. According to the latest OECD data available, Australia’s debt-to-net-disposable-income ratio now stands at 206% and is the fifth-highest in the world as shown in the chart below:

Click to enlarge

Source: Is Australia’s luck running out? by Robin Parbrook, Schroder’s

Extended high debt together with over heated housing sector does not bode well for households. Should the housing sector falter consumers will de-leverage sharply.