Commonwealth Bank CEO says soaring mortgages are inflating housing prices and threatening long-term financial stability
Australia’s largest lender has issued an unusual warning: mortgage demand is running too hot. Commonwealth Bank of Australia (CBA) CEO Matt Comyn told lawmakers Tuesday that the country’s booming appetite for home loans is helping push property prices higher—and may ultimately undermine financial stability, affordability, and equal access to housing.
While acknowledging that CBA benefits from rapid housing credit growth, Comyn said the current pace is unsustainably strong. “A more sustainable credit growth rate in housing would be slightly below the current level,” he told Parliament’s committee hearing, adding that demand is “pushing a higher level than policymakers and regulators might be comfortable with.”
New data from the Australian Bureau of Statistics shows new dwelling loan commitments jumped 6.4% in the third quarter, while housing credit growth has surged above post–financial crisis norms. The Reserve Bank of Australia says most of the heat is coming from investors responding to lower interest rates, intensifying competition in an already overheated market. CBA expanded its mortgage book by 6% to A$664.7 billion ($431 billion) in the year ending June 30, outpacing other major banks, which grew around 5%.
But the momentum may slow. Comyn said demand could ease as confidence fades that interest rates will fall anytime soon. Inflation remains stubborn, and CBA now expects the RBA’s cash rate to hold at 3.6% “more likely than not” through 2026—an outlook that could keep a lid on borrowing power.
Australia’s housing dilemma is now clear: banks are thriving on a credit boom that risks making homeownership even more unattainable—raising urgent questions about how long policymakers will tolerate a market running this hot.
