Sydney’s auction clearance rates have trended down over recent weeks, while auction volumes have materially increased. As a result, the growth in Sydney dwelling values has stalled.
Sydney’s final auction clearance rate fell to 62.4% last weekend, based on 987 auctions. This result was down from 64.1% the prior weekend (from 772 auctions) and from 70.8% four weekends ago (from 603 auctions).
Sydney held 1,182 auctions this weekend, the highest volume since the last week of November in 2025.
According to Cotality, Sydney’s preliminary auction clearance rate declined to 65.5% this weekend. This was down from 67.1% a week ago and the recent high of 79.6% over the week ending February 8th. It was also Sydney’s lowest preliminary clearance rate of 2026 so far.
Cotality’s daily dwelling values index shows a similar weakening trend.
Sydney’s dwelling values fell slightly (i.e., by -0.03%) over the past 28 days, underperforming the 0.62% dwelling value growth recorded across the five major capital city markets as a whole.
The Reserve Bank of Australia (RBA) is widely expected to raise interest rates further following the Australian Bureau of Statistics’ (ABS) strong inflation report last week, which showed 3.4% annual trimmed mean inflation in January, above the RBA’s target range of 2% to 3%.
The interest rate futures market predicts that the RBA will raise the cash rate again in May, with a very high probability of another hike before the end of 2026.
As shown in the table below, a 0.25% increase in mortgage rates adds $138 to the monthly repayments on the average new mortgage of $873,000 in New South Wales.
If the RBA were to lift interest rates another two times, then Australia’s official cash rate would return to its recent peak of 4.35%, with average variable mortgage rates increasing to 6.25%.
The average new mortgage holder in New South Wales would also see their minimum mortgage repayments increase by a cumulative $418 a month over what they would have paid if the RBA had not tightened.
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