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Commonwealth Bank Raises Alarm Over Surging Home Loan Demand

CEO Highlights Potential Risks to Financial Stability Amid Escalating Mortgage Growth

Commonwealth Bank Raises Alarm Over Surging Home Loan Demand?w=400

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The Commonwealth Bank of Australia (CBA), the nation's largest lender, has voiced concerns over the current surge in home loan demand, suggesting it may be contributing to escalating property prices and potential financial instability.
CEO Matt Comyn emphasized that while the bank benefits from increased housing credit, a more moderate growth rate would better support long-term financial stability and housing market accessibility.

Recent data from the Australian Bureau of Statistics revealed a 6.4% increase in new housing loan commitments in the third quarter compared to the previous quarter. This uptick is largely driven by low interest rates and heightened investor activity. CBA led the expansion in mortgage lending with a 6% increase to A$664.7 billion in the financial year ending June 30, 2025, while other banks saw around 5% growth.

Comyn anticipates that demand may ease due to expectations that interest rates will remain at 3.6% through 2026, as inflation remains elevated. However, he cautioned that the current pace of credit growth is unsustainable and could undermine long-term financial stability and housing market accessibility.

For prospective borrowers, this development underscores the importance of prudent financial planning and awareness of potential market shifts. Consulting with financial advisors can provide valuable insights into navigating the evolving lending landscape and making informed decisions aligned with individual financial goals.

Published:Monday, 8th Dec 2025
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

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Balloon Payment.:
A large loan repayment made in order to clear a debt. Usually applied to a short-term fixed-rate loan, which involves small payments for a certain period of time with one large payment for the remaining amount of the principal at a time specified in the future.