Auction momentum cools but clearance rates remain above 80% in some suburbs

Auction clearance rates are softening in the major capital cities as buyers feel less urgency to rush into a rising market.

However, strong demand from first-home buyers tapping into expanded government support has driven the auction clearance rate to around 80% in some outer-city pockets.

The national auction clearance rate has trended downwards since February, when the RBA delivered the first of two interest rate hikes this year.

In the two major auction cities, Melbourne’s clearance rate has dipped from close to 70% in February to around 55% before the Easter lull. Sydney has seen its clearance rate dip to around 50%.

But new data from PropTrack shows auction demand is still hot in certain pockets of the market, particularly those popular with first-home buyers.

Analysis of the suburbs with the highest auction clearance rates during the period between early March and April show Melbourne’s affordable outer ring dominated the top 20 list.

Top 20 auction clearance rates across the country:

Epping in Melbourne’s north has a clearance rate of 81% over the period, with nearby Thomastown, Mill Park and Mernda all hovering near 80%.

Mulgrave and Noble Park in the city’s east and Caroline Springs in the west have also cleared around 80% at auction over the past month.  

Local agent Rob Stefanovski from Harcourts Rata & Co said homes around Epping, Thomstown and Lalor were in high demand with first-home buyers, with properties often receiving multiple bids at auction.

“All properties are selling in a timely manner,” Mr Stefanovski said.

“Around the City of Whittlesea from the edges of Bundoora, but more like Mill Park, South Morang, Epping, Thomastown, Lalor, those suburbs, we’re getting more than one person for each property.

“So I’d say there’s a bit more demand than supply – it’s not as hot as I’ve seen the market sometimes, but it is still hot.”

He said the sub-$1m market was attracting strong activity, while upgraders in a higher price bracket were being more selective.

He pointed to two recent sales that attracted multiple bids at auction – a dilapidated home on a large block at 7 Cleeland Close in Epping, with six bidders driving the price to $670,000, well above the $550,000-$605,000 price guide.

“You couldn’t live in it as it was and so for that reason you had people that wanted to renovate it and move into it, you had people that wanted to renovate it and flip it, and you also had investors that thought the land was good.”

“The other property was first-home buyer territory, and that was 19 Virginia Crescent in Bundoora. That sold for $842,000; the reserve was in the high sevens. The two last bidders were both first-home buyers.”

By contrast, the Sydney suburbs to make the top 20 list were in affluent pockets near the beach or harbour.

Will Gosse, director and acting CEO of Sydney real estate agency Bresic Whitney, said buyers looking for apartments and entry-level homes in these markets were likely being encouraged by the pullback in market momentum.

“There’s still some energy sub $1.5m, driven partly by first-home buyer initiatives and a sense among that demographic that this might finally be their opportunity to enter the market,” Mr Gosse said.

“Clearance rates are holding better in suburbs where supply is constrained and buyer conviction is high. Bondi and Woollahra are good examples of that right now.”

Over the weekend, a two-bedroom apartment in Woollahra sold for almost $200,000 above its asking price with five registered bidders.

Clues for market momentum

Senior data analyst at PropTrack, Megan Lieu, said at a bigger picture, clearance rates can act as a leading indicator into housing demand.

“As auction rates tend to be quite responsive to changes in interest rates, they often provide an early indication of shifts in housing demand,” Ms Lieu said.

“The recent auction clearance rates provide early signals of cooling buyer activity.”

She noted that while interest rates hikes tend to have a moderating effect on demand, supply is also an important component.

“Supply trends have also contributed to a slowdown in housing market activity, particularly in Sydney, Melbourne and Canberra. New listings in these cities have recorded year‑on‑year growth every month since October 2025, with the exception of November.

“The remaining capital cities continue to face supply constraints which is likely helping to sustain stronger relative price growth despite the higher-interest rate environment.”