CBA tightens lending rules for landlords as major banks bring in negative gearing changes

June 1, 2026 - 07:33

Australia's largest bank has quietly overhauled its lending criteria for property investors, signaling a significant tightening of credit conditions in the housing market. The Commonwealth Bank of Australia now requires landlords to demonstrate higher rental income thresholds and stricter serviceability buffers before approving new loans.

The move comes as several major banks adjust their policies in response to ongoing speculation about negative gearing reforms. While no official legislation has been passed, lenders are preemptively tightening their books to account for potential changes to tax deductions on investment properties. Under the new rules, CBA will apply a more conservative assessment of rental income, reducing the amount landlords can claim as future earnings when applying for a mortgage.

Industry analysts say this could cool investor demand, particularly in Sydney and Melbourne where property prices remain elevated. The changes also include higher interest rate stress tests, meaning borrowers must prove they can afford repayments at rates significantly above current levels. Some brokers have reported that investors with multiple properties are now finding it harder to refinance or expand their portfolios.

The bank has not made a public announcement, but internal memos seen by industry sources confirm the policy shift. Rival lenders are expected to follow suit, potentially reshaping the investment landscape ahead of any formal government action on tax breaks. For now, landlords face a more cautious lending environment, with banks demanding greater proof of financial resilience.