Sydney’s Housing Bubble Seen Surviving Tepid Loan Limits

Australian regulators are flashing warnings. Banks are vowing to curb lending. And that may not be enough to damp runaway housing prices.

At the urging of the financial services watchdog, the nation’s biggest mortgage lenders, including National Australia Bank Ltd., plan to trim the growth in loans to investors who have been on a home-buying frenzy. Regulators may have to impose stricter measures like those in New Zealand to cool Sydney’s housing market, said Shane Oliver, head of investment strategy at AMP Capital Investors Ltd.