Australian banking majors face a step lift in capital strain following recent policy changes and decades of high loan volumes to fund home buying that contributed to a surge in house prices, Jarden said in a late Monday note.

During the last 30 years, AU$2.4 billion of credit was directed to fund home buying, more than double the AU$1.1 billion extended to productive uses in business, according to the note.

Home loan risk weights started at 50% in the 1990s, troughed at 14% in 2014, and are now averaging roughly 23%, Jarden said. ANZ Group (ASX:ANZ, NZE:ANZ) has a home loan risk weight of 24%, Commonwealth Bank of Australia (ASX:CBA) 22%, National Australia Bank (ASX:NAB) 26%, and Westpac Banking (ASX:WBC, NZE:WBC) at 20%.

"We see a change in mix of required macro capital allocation," the equity research firm said in relation to banks supporting productive investments instead of relying on housing loans. It also questioned whether the banks' dividend payout ratios are too high, as the policies were implemented when home loan growth regularly exceeded corporate lending growth.

Jarden believes major bank share prices remain expensive even after some retracing, and are not priced for any negative regime change.

It maintained an overweight rating and Au$35.50 price target on ANZ, while keeping a sell rating on the other three banks. Commonwealth Bank's price target remains at AU$90, National Australia Bank's at AU$29, and Westpac's at AU$31.