SYDNEY • The chief executive of Australia & New Zealand Banking Group (ANZ) has joined the chorus of voices warning of risks in Australia's surging housing market, though he said the probability of an outright crash is "really low".

Home prices are "very inflated", ANZ chief executive Shayne Elliott said in an interview yesterday with Bloomberg Television's Stephen Engle in Beijing. In Sydney, prices have gained 75 per cent in the past five years, ranking it behind only Hong Kong as the world's least affordable housing market.

Asked whether a crash is looming, Mr Elliott said it's "a really low probability, but it is certainly something we stress test a lot and think about".

S&P Global Ratings downgraded the credit scores of almost all of Australia's financial institutions last month as it warned that the risks of a "sharp correction'' in property prices had increased.

The country's four largest mortgage lenders, including ANZ, were spared from the downgrade because S&P said it assumed the government would step in to provide support if needed.

Mr Elliott criticised the Australian government's recent decision to raise revenues by imposing a levy on the country's large lenders, though he said the priority now should be to work out the best way to implement the measure.

BLOOMBERG