Debt to income limits come nearer for borrowers

It would restrict would-be borrowers' access to a loan to a set proportion of the total sum of money they earn.

It is known as a Debt to Income ratio (DTI) and comes on top of Loan to Value Ratio (LVR) limitations which already exist.

But LVR limits look at the ratio of a deposit to the capital value of a home. DTI's are based on earnings of borrowers, and would be established as a second line of defence against an out-of-control housing industry.

The Reserve Bank insists no decision has been made to actually implement DTIs and they could not be in place before 2024 anyway.