Australia’s housing market is heading into 2026 with interest rate nerves front and centre. After a quiet start to the year, auctions suddenly ramped up as both buyers and sellers responded to signs that the next move from the central bank is more likely to be up than down. The market has already lived through a long run of rate rises and slower growth, so many sellers appear keen to transact now rather than risk softer conditions later.
In the week to Saturday, about 1629 homes were scheduled for auction, more than three times the combined total of the previous four weeks according to data from a major property analytics firm. The preliminary national clearance rate hit roughly 69.7% and this was its strongest result since mid November. This suggests that buyers who can still afford to bid are acting decisively. Analysts at the research group say the jump in clearance rates lines up with new inflation figures and solid jobs data, which have pushed economists to bring forward their expectations of a 25 basis point rate rise from the Reserve Bank.
Melbourne was the busiest auction city, with around 643 scheduled auctions, up about a third on the same week a year earlier and a preliminary clearance rate near 69.3%. In the city’s north east, a four bedroom family home on a block of about 1127 square metres sold for $1.86 million, roughly $180,000 above its $1.68 million reserve as a local family saw better value in an established house on a large lot than in building new. Sydney saw fewer auctions, about 468 and only a small increase year on year, but its clearance rate climbed to roughly 71.3%. This was the best result since mid October and was helped by vendors who accepted strong pre auction offers, such as a western Sydney unit guided at $380,000 that changed hands for $420,000 before it could go under the hammer.
Smaller capitals told their own story. Brisbane scheduled about 221 auctions and recorded a preliminary clearance rate near 75% on reported results, while Adelaide, with 153 scheduled auctions, led the country with an early clearance figure around 86.1%. Canberra bucked the trend, with about 135 auctions but a clearance rate under 40% and this was its weakest result since mid 2019. This hints at more cautious buyers or misaligned vendor expectations. Across the board, property analysts caution that preliminary clearance numbers generally drift lower as more results filter in over the following days.
Looking ahead, the market seems to be in a delicate balancing act. On one side, the prospect of higher interest rates is nudging vendors to be more flexible and encouraging buyers to act before their borrowing power shrinks. On the other side, expectations have already been fairly realistic over the past year so any rate rise looks more likely to trim heat from the market than trigger a sharp correction. If the central bank does lift rates and households feel the squeeze, demand could slowly ease and clearance rates may retreat, but for now auction rooms in the larger capitals still look busy, with urgency rather than panic driving decisions.
