CBA Boss Comyn: House Prices Won’t Bottom Until Well Into 2027

Commonwealth Bank CEO Matt Comyn believes Australia is roughly halfway through a housing market correction that will last well into 2027. National property values have fallen 5.2% from their March peak, with experts predicting further declines of 10-15% before the market stabilises. Rising interest rates, not recent tax reforms, are the primary driver of the downturn.

How far will house prices fall

The Reserve Bank of Australia has raised rates four times this year, with financial markets expecting at least one more rise in November or 2027. Cotality research director Tim Lawless believes an overall reduction of 10-15% is a fairly reasonable estimate. A 15% fall would be larger than any previous downturn in Australia’s five property slumps over the past 20 years.

The current decline follows six straight months of price falls since March. Using the Domain property price series, a typical home has dropped to roughly what it would have fetched one year ago.

What caused the housing market to weaken

Interest rate hikes have been the key driver, not property tax reforms announced in the May federal budget. Treasury experts estimated the tighter rules on negative gearing and capital gains tax would dampen prices only around 2% over a couple of years. The downturn was already well established in most parts of Australia before the budget changes, following the first official rate rise in February.

Much of the long-term run-up in house prices was fuelled by declining interest rates over three decades to 2020, which boosted buyers’ borrowing capacity. That dynamic has reversed sharply.

Why Comyn’s forecast matters for investors

Comyn, who has embraced AI systems at a business level, argues AI could help lift the country’s falling productivity growth. CBA stock trades at A$148.12, down 2.8% today and 11.2% over the past year. Meyka rates the stock a B with a 12-month forecast of A$172.99, suggesting limited downside from current levels. The bank’s dividend yield stands at 3.36%, attractive for income investors weathering the property slowdown.

Final Thoughts

Comyn’s forecast signals prolonged weakness in Australia’s housing market, likely to pressure mortgage demand and bank lending into 2027. With CBA graded B by Meyka and trading near support, investors should monitor rate decisions closely.

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The content shared by Meyka AI PTY LTD is solely for research and informational purposes.  Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.