Australian auction clearance rates hit low

• Auction clearance rates fell across major Australian cities to a preliminary 48.2%.
• The decline marks the lowest level recorded by Cotality since June.
• Interest rate rises reduced buyer borrowing capacity and weakened overall market sentiment.

Cotality reported that Australia's combined capital preliminary auction clearance rate dropped to 48.2% last week.

The fall follows the central bank's recent cash rate increase, which reduced buyer borrowing capacity compared to earlier months.

"The cash rate increase likely contributed to the weaker result as prospective buyers faced reduced borrowing capacity," said Cotality Economist Annabelle Mezieres.

Lower activity in smaller markets dragged down the national average, with Brisbane recording a clearance rate of 25.6%, Adelaide at 41.5%, and Canberra at 41.7%.

Despite the broader decline, Sydney and Melbourne maintained higher clearance levels, reporting rates of 55.7% and 50.6% respectively.

Canberra led the annual volume drop, holding 31 auctions during the week, which represents a 46% decline compared to the same period last year.