Melbourne’s Auction Market Surges Ahead of RBA Move

Melbourne’s property market is heating up as early clearance rates jump above 70%, driven by a rush of buyer activity just days before a potential interest rate cut by the Reserve Bank of Australia. The rise in pre-decision momentum shows how the expected rate drop could spark increased market confidence but might also place pressure on affordability for some buyers.

Nationally, auction activity is on the rise as vendors anticipate the RBA’s upcoming move. In total, 1,835 homes went under the hammer this past week across Australia, marking the busiest period since before Easter. Market researchers suggest this surge is only the beginning, with auction volumes expected to climb by as much as 50% over the coming fortnight.

Melbourne stood out with a preliminary auction clearance rate of 73.8%, the second-highest for the city this year. A total of 935 properties went to auction, up from 799 the week before. Though this shows increased confidence, the clearance rate is still down by over 7 percentage points compared to the same period last year, revealing signs of cautious buyer sentiment.

Elsewhere, results were mixed. Brisbane recorded its strongest auction volume since Easter, but only 59.6% of homes sold, indicating softer demand. Sydney saw 558 homes auctioned, down from 658 the week prior, and 23% fewer than this time in 2024. Experts believe higher stock levels are being matched by buyer interest, helped along by post-election certainty and the looming rate change.

One standout sale this week came from Sydney’s Balmain East, where a waterfront townhouse with direct harbour access sold for $6.12 million. The home attracted strong interest, including a last-minute buyer who registered mid-auction. Adelaide also saw notable action, with a 1925 bungalow in Highgate selling for $2.56 million, the city’s top result of the weekend.

Despite strong headlines, clearance rates in smaller capitals dipped. Adelaide dropped from 66.7% to 64.1% with 139 auctions held, while Canberra recorded its lowest early clearance rate in three weeks at 56.6%. However, increased auction volumes hint that both buyers and sellers are preparing for a more active winter market.

Source: Australian Financial Review, CoreLogic, Elite Buyer Agents