Commonwealth Bank's offer of a short-term discount to borrowers for any housing loan is a move that reflects the growing importance of online competition among Australia's major banks.

Commonwealth Bank pledged to beat any advertised rate by ANZ, National Australia Bank and Westpac until the end of the September on new loans worth $100,000 or more, or new borrowings from existing customers of the same amount.

Michael Cant, Commonwealth Bank executive general manager of retail, said the guarantee was an effort to "get through the noise” or the complexity of the products and their increasing tendency to market them online.

"There would be hundreds of rate offers out there in the home-loan market," he said. "They're all different and it's hard to make sense of them," he said.

"By offering a guarantee, it was our way of saying 'whatever type of product you want, we will guarantee to beat the rate of any other major bank'."

The "noise" in mortgage lending is the rise of home loans being marketed, advertised, researched and compared online, both by dedicated online lenders, like NAB-owned UBank (www.ubank.com.au), and by rate comparison sites such as RateCity.com.au,Mozo.com.au, Canstar Cannex (www.canstar.com.au), and InfoChoice (www.infochoice.com.au).

There is "no doubt" online loan marketing will make prices less "sticky" and more responsive to the market demand than they currently are, said Colonial First State Asset Management economist James White, without commenting directly on CommBank's move.

The more of the pricing that is online, the fewer "menu costs," or cost of marketing that make prices slow to change, for the bank selling the mortgages, Mr White said.

He said it also occurred on the customer side.

Colonial First State is owned by Commonwealth Bank.

With prices centralised online, the so-called "shoe leather costs" of customer time and effort running around to compare prices also falls, Mr White said.

“That's why markets aren't as competitive as they should be because often you weigh up the trade-off between searching around every shop in town and just going to the nearest one and paying that price in town."

"With the internet you don't have to do that."

To date, internet-shopping has elevated price and selection as key areas of competition for household goods, books, music, electronics, and travel sales in Australia.

The ability for consumers to compare nationwide and internationally has squeezed the profits of businesses that can't adapt quickly enough to the shift in consumer shopping habits.

As the pace of lending for houses slows, more consumers will be shopping around for the best deals on mortgages, as well, Mr Cant said.

Monthly home loans have staged a tentative recovery in the three months to July, rising 1 per cent that month, but leading indicators for the real estate market point to weakness.

"The amount of competition in the market at the moment is very intense," Mr Cant said.

"Lots of banks want to lend. The home-loan market is not growing as quickly as we'd all like it to grow. The natural response to this is lots of competition from the banks for people in the market for home loans."

Typically the major banks have competed to win over each other's customers but ignored the online rate shoppers, Rate City media spokeswoman Michelle Hutchinson said.

That was evident in the rates between the major banks and online-only operators, which had widened as much as a full percentage point in recent weeks.

Increasingly, she said, the major banks were focusing on online customers.

"We are starting to see some of the major banks targeting the online comparison market with advertising and they are starting to notice the potential for being in front of online customers."