CommBank has reported a surge in conditional pre-approval activity, with applications jumping 12% in 2025 after two 0.25% per annum (p.a.) variable rate cuts, compared to the same period in 2024.
The average pre-approval amount also climbed 13% year-on-year.
The bank said the increase shows more Australians are preparing to purchase property – from first-home buyers through to investors – as falling interest rates boost confidence and borrowing capacity. Another 0.25% p.a. cut will take effect for CommBank customers on Aug. 22.
Following May’s second variable rate cut of the year, national conditional pre-approval applications rose 12% compared to 2024 levels.
New South Wales led the surge with a 25% increase, followed by Queensland at 16%, while Victoria held steady.
“It’s encouraging to see more people feeling confident about their home buying options,” said Marcos Meneguzzi (pictured left), CommBank executive general manager home buying.
The Aussie dream has long been anchored in homeownership, and this rise in conditional pre-approval activity reflects a renewed sense of optimism as borrowers respond to lower interest rates and increased borrowing power.”
“Conditional pre-approval is one of the very first steps when buying a home. Buyers get a sense of their budget and that helps them act quickly when the right property comes along.”
The average conditional pre-approval amount applied for in May reached just over $733,000, up 13% on the year. Among first-home buyers, the average was $546,000, an 11% increase.
“With our latest variable rate reduction coming into effect from 22 August, this trend could continue as buyers look to leverage the current downward rate cycle,” Meneguzzi said.
CommBank, which posted a $10.13bn FY25 profit (up 7% on FY24), highlighted that conditional pre-approval gives buyers confidence in knowing their borrowing power upfront and allows them to move quickly in competitive markets.
The process is designed for speed and convenience:
“At CommBank, we can also provide suburb and property reports, plus upfront cost estimates like stamp duty and legal fees, to give buyers added clarity as they navigate the market,” Meneguzzi said.
The lift in home loan activity comes as CBA economists point to a turning point in household spending.
After a slow start to 2025, consumer confidence and discretionary spending are now on the rise, with younger households leading the recovery.
CBA’s Household Spending Insights recorded 6.4% annual growth in July, marking 10 consecutive months of gains. At the same time, consumer sentiment jumped 5.7% in August to its strongest level since February 2022.
“We’re seeing a delayed but encouraging response to improving fundamentals like rising incomes, moderating inflation and a resilient labour market,” said CommBank senior economist Belinda Allen (pictured right). “Green shoots are emerging in our household spending data, and sentiment is lifting.”
CommBank expects consumption growth to strengthen through late 2025 and into 2026, supported by tax cuts and interest rate reductions. Markets are also anticipating a further RBA cut in November, which would add to household confidence and borrowing capacity.
CommBank noted that three 0.25% p.a. cuts announced in February, May, and now August have lifted borrowing capacity by around 7%.
Head over to the CommBank Newsroom for more information.
Get the hottest and freshest mortgage news delivered right into your inbox. Subscribe now to our FREE daily newsletter.
