ANZ and National Australia Bank have tightened restrictions on how much debt a new home borrower can take on compared with their income. A quarter of borrowers have risky debt.
The big banks are watching to see which one blinks first, with the first interest rate rise in more than a decade coinciding with a period of intense mortgage competition.
Westpac, Australia s second biggest bank, has updated its forecasts to have the Reserve Bank raising interest rates in June, instead of August as previously predicted.