Sydney and Melbourne Clearance Rates Slide in a Buyer's Market

Australia's combined capital auction clearance rate fell to 48.9% last week, down 20.9 points from a year ago, as higher rates keep buyers cautious.

MPA Australia reports that the weighted average final clearance rate across Australia's combined capital cities fell to 48.9% for the week ending 16 August 2026, retreating 2.5 percentage points from the previous week's 51.4% — and sitting a full 20.9 percentage points below the 69.8% recorded in the same period a year earlier.

A total of 1,276 auctions were held across the combined capitals that week, down 7.7% from 1,382 the week prior and 33.6% below the 1,921 conducted in the equivalent week in 2025. When fewer than half of the properties going to auction are selling under the hammer, the market dynamic shifts noticeably — sellers are under more pressure, and buyers have real negotiating room.

You can read the full Cotality data as reported by MPA Australia.

How Sydney and Melbourne Are Performing

Sydney held 412 auctions for the week, broadly unchanged from 410 the prior week, but its clearance rate fell sharply — down 4.4 percentage points to 47.1%. That means more than half of properties listed at auction in Sydney last week did not sell. Compare that to the equivalent week in 2025, when Sydney ran 705 auctions and cleared approximately 71.7% of them.

Melbourne hosted 588 auctions, down 10.8% from 659 the previous week. Its clearance rate eased 3.9 percentage points to 52.9%. The contrast with 2025 is stark: the equivalent week last year saw 932 Melbourne auctions clear at a 69.1% rate. Both cities are now running with roughly 40% fewer auction listings than a year ago.

Among the smaller capitals, results were more mixed. Canberra posted the highest clearance rate of any capital at 53.5% — up 6.7 percentage points — from 43 auctions. Adelaide cleared 51.2% from 84 auctions. Brisbane held relatively steady at 35.9% from 142 auctions, while Perth's rate rose from 22.2% to 33.3% from a statistically limited sample of nine auctions.

Cotality attributed the results to the broader softening in housing conditions through 2026, noting that the cash rate has remained at 4.35%, borrowing capacity is constrained, national dwelling values have fallen in recent months, affordability remains stretched, and buyer demand is subdued.

What This Means for Buyers and Refinancers

For owner-occupiers currently in the market, sub-50% clearance rates are a concrete negotiating signal. When more than half of auctioned properties are passing in, vendors face real pressure to negotiate after the auction — sometimes on price, sometimes on terms. This is the kind of environment where comparing the cheapest home loans available before you bid gives you genuine leverage, because knowing your upper rate limit shapes what you can afford to pay.

For first home buyers in particular, this environment is more navigable than anything seen in recent years. There is more time to conduct due diligence on a property, negotiate contract conditions, and lock in finance pre-approval without the frenetic pace that characterised the 2025 market. Use a borrowing power calculator to understand your realistic ceiling before you attend any auction — it prevents emotion from pushing your bid past what your lender will actually support.

Looking at the forward pipeline: scheduled volumes for the following week are set to rise to 1,416 — up 11% from the current week but still 31.5% below the 2,066 auctions held in the same period last year. Sydney has 526 auctions scheduled, a lift of 116 from last week but still 27.8% below year-ago levels. Melbourne has 565 scheduled, down 3.9% from last week and 42.6% below the year-ago figure of 985. Cotality forecasts volumes rising to approximately 1,550 the following week before easing to around 1,300 in the week ending 6 September.

For refinancers, the same underlying forces suppressing auction activity — the 4.35% cash rate, restrained borrowing capacity, softened values — are creating lender competition for quality borrowers. With market-wide loan volumes moderating, lenders are working harder to attract creditworthy customers. That can translate into better pricing for those willing to do the comparison work. A refinance savings calculator is a practical way to see whether a rate shift of even 0.25 percentage points makes a material difference to your monthly repayment.

The Cotality data tells a consistent story: the Australian property market has adjusted to a sustained higher-rate environment. For buyers who have been waiting for conditions to improve, sub-50% clearance rates are a clear signal that the balance has shifted.