Growth in housing credit is continuing despite fears of a slump in house prices, the Commonwealth Bank says. The CBA is expecting 8 to 10 per cent growth in total credit - housing and business - over the rest of 2003.

CBA's housing prices measure recorded an increase of 23 per cent nationally in the 12 months to March 2003. The continued strength in the housing market was due to low interest rates, consumer expectations, a competitive lending market and the relative unattractiveness of other investment options, a spokesman said. Low-income earners and first-home buyers would probably cope with higher interest rates but people who entered the housing market late would be most at risk if conditions change, he said.