Key takeaways:
Competition is becoming more selective, with overall clearance rates remaining subdued but well-priced homes still attracting multiple bidders.
Buyers may have more negotiating opportunities, as more properties pass in or sell after auction rather than under the hammer.
Preparation remains a key advantage, with brokers saying buyers who understand their borrowing power are bidding with greater confidence.
Property type and price matter, as affordable family homes and quality apartments continue to generate strong buyer interest.
If you're planning to buy at auction soon, this week's results suggest one important lesson: not every property is attracting the same level of competition.
For the week ending August 2, Cotality reported a combined city clearance rate of 48.9%, with Sydney recording 45.6%, Melbourne 54.7%, and Brisbane 37.5%.
Perth recorded the highest preliminary clearance rate at 70, although this was based on just 10 reported auctions.
The figures indicate a lower proportion of reported auctions clearing across several capitcal cities during the week. Why? A weekly clearance rate is an indicator, not conclusive evidence that the overall property market is softer.
Looking beyond the headline numbers, however, tells a more useful story for buyers.
While many auctions are attracting fewer bidders and more properties are passing in, well-presented homes in popular locations are still generating competition. Rather than a uniformly soft market, competition appears to be becoming more selective.
For Australians planning to buy, that may mean greater flexibility for some properties, while others could still require careful preparation and disciplined bidding.
What lower clearance rates may mean for buyers
Auction clearance rates are often used as one indicator of market conditions, but they can also provide clues about buyer behaviour.
Independent economist Cameron Kusher said this week's results reflect a market where buyers are feeling less urgency.
“It’s really saying that there's not a lot of competition,” he said.
He said many buyers are choosing not to compete under auction conditions, instead waiting for opportunities to negotiate through private sale if a property passes in.
“A lot of people have decided, 'I'm not going to bid at auction. I want to buy under private sale conditions because that just gives me a bit more flexibility’,” he said.
You might also be interested in: Why more sellers may be choosing private treaty over auction
For buyers, that may mean:
more opportunities to negotiate after an auction
less pressure to make quick decisions
more choice as stock levels remain relatively high.
However, lower clearance rates do not necessarily mean every property will be easier to buy.
Why Melbourne's clearance rates have been edging higher
Melbourne's preliminary auction clearance rate has been trending higher over the past month.
On the week ending 12 July, the city recorded a preliminary clearance rate of 50.3%. That increased to 50.6% the following week, 51.7% the week after, and 54.7% for the week ending 2 August.
While Sydney's clearance rates have fluctuated between 42.4% and 53.3% over the same period, the two markets have different auction volumes and market dynamics. Instead, Melbourne's recent results suggest its auction market has been gradually strengthening over recent weeks.
Kusher said the stronger result may reflect changing seller expectations rather than a sharp increase in buyer demand.
“Melbourne's a bit stronger, and probably because that market's been weaker for long enough,” he said.
“Vendors are possibly a bit more realistic with their reserve prices than they are in the other markets as well.”
For buyers, it's a reminder that auction results aren't driven solely by buyer demand. Sellers who set realistic reserve prices may be more likely to achieve a sale under the hammer, even in a softer market.
That trend is also being reflected on the ground. Christopher Franklin of Aussie Gisborne said homes in his local market are continuing to sell when they're priced in line with buyer expectations.
“As long as the property's priced right, they're selling,” he said.
This reflects Franklin’s experience in his local market and may not represent outcomes elsewhere.
Competition depends on the property, not just the market
One of the clearest themes from this week's auctions is that buyers are still competing strongly for homes that tick the right boxes.
A renovated family home at 17 Drummond Street, Blackburn South in Victoria sold under the hammer for $1,155,000 after attracting four active bidders, all of whom placed bids during the auction, according to selling agent Cassie Wang of Biggin & Scott Manningham.
17 Drummond Street, Blackburn South
She said the property appealed to families because it was move-in ready, well located and suited to family buyers. The successful purchaser was a first-home buyer.
She said homes around the $1 million price point continue to attract solid buyer interest, while competition tends to ease for properties priced above $1.5 million.
For buyers, it's a reminder that headline clearance rates don't tell the whole story. Renovated family homes in sought-after suburbs may still attract strong competition, while higher-priced homes or properties requiring work could offer greater scope to negotiate.
Apartments are showing steady demand
The same pattern is emerging in parts of Sydney's apartment market.
At 51/183 St Johns Avenue, Gordon in Sydney, two registered bidders competed before the property sold under the hammer.
51/183 St Johns Avenue, Gordon
Selling agent Domenic Maxwell from Ray White Upper North Shore said the buyers he was seeing in his local market were predominantly owner-occupiers.
Maxwell added that in his local market, smaller apartments continue to appeal to first-home buyers, while larger apartments are attracting upsizers and downsizers looking for lifestyle and value.
For buyers considering apartments, the latest results suggest well-presented properties that offer value continue to attract genuine interest, even as broader auction conditions remain softer across Sydney.
Buyers are sticking to their budgets
While competition varies between properties, brokers say one thing hasn't changed: many buyers are arriving well prepared.
Franklin said his clients heading to auction know exactly what they can afford before bidding begins.
“They're pre-approved. This is where you're at. This is your ceiling,” he said.
Franklin said two of his clients successfully purchased homes at auction over the weekend after completing their finance pre-approval, legal checks and due diligence beforehand.
“They'd prepared properly, so they could be confident,” he said.
He encouraged buyers to understand their borrowing limits before bidding.
“Know your ceiling. Know your limit. Make sure you're pre-approved so you know exactly where you're at,” Franklin added.
Understanding your borrowing capacity before auction day may also make it easier to act if negotiations continue after a property passes in.
Pre-approval is conditional and does not guarantee final approval. Buyers should also account for purchase costs and any changes in their circumstances. An Aussie Broker can help you understand what you may be able to borrow, compare loan options and model different scenarios before you make an offer.
Some buyers are returning to the market
Although overall auction results remain subdued, some brokers are seeing signs that more buyers are returning to the market.
William Christmas of Aussie Bondi Junction said inspection numbers have picked up across parts of Sydney following the winter holiday period.
He said recent inflation data and lender activity may be contributing to confidence among some buyers he is speaking with.
Importantly, he said buyers aren't necessarily increasing their budgets.
Instead, Christmas said some buyers he is speaking with are reconsidering properties as prices or seller expectations adjust.
“I don't think people are spending more than they have, but I think people are welcoming prices that they can actually afford again,” he said.
That doesn't mean competition has returned across the board, but it does suggest buyers who have been waiting on the sidelines may gradually be re-entering the market.
Auction insight
Competition is changing, not disappearing
This week's auction results suggest buyers shouldn't assume every property will attract a bidding war, nor should they assume every auction will present an easy buying opportunity.
Move-in ready family homes and quality apartments continue to attract competition, while other properties may give buyers more opportunity to negotiate.
Understanding the local market and the type of property you're buying may be just as important as following the overall clearance rate.
Before you bid
If you're planning to buy at auction this weekend:
Know your bidding limit. Having a clearer understanding of your finances and options before auction day could help you feel more confident before auction day.
Don't assume every property will sell under the hammer. Passed-in properties may create opportunities to negotiate.
Research comparable sales. A softer market doesn't necessarily mean every property represents good value.
Thinking about bidding?
Knowing your borrowing power before auction day may help you make more confident decisions. An Aussie Broker can help you understand your budget, compare loan options and determine what may be achievable based on your circumstances.