A national slump of auction clearance rates could temporarily push home prices down as "hesitant" homebuyers are spooked by a maelstrom of local and global volatility.
The combined capital city clearance rate has remained below 60 per cent for six of the last eight weeks, according to fresh data released by Cotality.
While this past weekend's figures rose slightly after a low of 57.5 per cent in the wake of the 2026 federal budget's sweeping tax reforms, auction rates are yet to return to full health following a series of rate hikes and ongoing geopolitical conflict.
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The Brisbane property market suffered the largest drop compared to the same weekend last year, with a meagre preliminary clearance rate of just 45.7 per cent.
Meanwhile, Sydney's clearance rate hit 56.9 per cent, a steady jump from 49.2 per cent the week prior, which was a figure not seen since the early weeks of the COVID-19 pandemic.
In Melbourne, the city's clearance rate hit 60.4 per cent, sitting above the national threshold for the second week in a row.
Adelaide's auction volume slipped by 8.8 per cent on the weekend prior, but the city still had the highest rate in any capital at 72 per cent.
Canberra's auction market also held steady at 54.3 per cent, a slight drop on the week prior.
Property experts expected a sharp clearance rate drop after the federal government's negative gearing and capital gains tax (CGT) discount changes, however the data reflects a long-term trend of caution among buyers and sellers.
"The property market is often driven more by sentiment than by financial logic, and when buyers feel uncertain about the future – whether that's their mortgage repayments, their job security, or just the general state of the world – more of them choose to sit on the sidelines and wait," property investment guru and Your Empire chief executive Chris Gray told nine.com.au.
"That hesitation shows up directly in auction clearance rates."
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The threat of another rate rise in September and a lack of clarity over when the US-Iran conflict might end has tripled the uncertainty whipped up by the federal budget.
Gray said that homebuyers may not feel comfortable committing when "they feel like the goalposts might shift".
It could take some time for auction clearances to settle to normal rates and for buyers to feel a sense of financial safety.
The long-term impact of the budget will "take some time to fully digest".
"So there is likely to be a continued period of hesitation while the market adjusts to the new landscape," Gray explained.
"That's a normal part of the cycle, and it won't last forever."
There could be a short-term slump in property prices as buyers wind back their offers in response to the softer market, Gray added.
But this may be as small as a $50,000 change on a $1 million property.
Some areas may feel a dip in prices more than most.
"The properties that struggle are those with structural disadvantages: poor location, no parking, compromised aspect, or significant oversupply in the immediate area," he said.
"These are far more sensitive to shifts in sentiment, and that's where you'll see the most pronounced price movement."
A little over 2750 properties are expected to go to auction next weekend.
