www.silverguide.site –

Victor Baralos knows the power of an auction. He bid against 25 others to buy his home in Sydney’s inner west for $200,000 over the reserve in 2012, when nearly half the auctions in Australia were failing.

Yet Baralos sold on Monday, just a week after listing his home, with three weeks left of his auction campaign.

His buyers offered less than he thinks the four-bedroom Croydon Park house would have sold for in December. His real estate agent, Harris Tripp’s Michael Poynting, cheered him on.

“I could have let it run, but I said to myself, a bird in the hand is better than ten in the bush,” Baralos said.

“You cut to the chase, you get it done, and move on.”

Homeowners are turning away from auctions to sell early, privately or not at all as economic stress scares off buyers and sales rates slide.

Fuel prices have pushed up costs everywhere and left the Reserve Bank warning it could hike mortgage rates further, even if that could increase unemployment and risk recession.

Consumer confidence has also fallen to a record low in ANZ’s survey, and open home attendance has followed suit. The number of people bidding at the average auction in Sydney or Melbourne was one-third lower in the final week of March than it was a year before, Ray White reported.

Falling buyer interest has started to drag down house prices in the two capitals, while encouraging homeowners and investors to sell up as soon as they can.

At the same time, the cities have seen solid numbers of homes listed for sale. Finalised sales have slumped from the nearly 30,000 recorded in both cities in the December quarter to less than 20,000 in each in the March quarter.

Homes in both cities had been selling in 30 days or less in the last four months of 2025, but now sit on the market for 33 days in Sydney and 35 in Melbourne.

Sydney, Australia’s biggest auction market, saw clearance rates fall to 50.4% in the last week of March, the lowest rate since July 2022, according to Cotality data. Melbourne’s rate fell to 54.2% in the same week, with both rising only slightly after Easter.

Smaller capitals have also seen buyers step back, but sellers are protected by strong price growth and supply shortages, according to Melinda Jennison, president of the real estate buyers agents association (Rebaa).

Homes listed for sale have slumped over the last year in Brisbane, Adelaide and especially Perth, where homes typically sold in just 9 days in March.

“There’s still more buyers than there are sellers,” Jennison says.

‘Buyers are in the driving seat’

In the more expensive markets, though, sellers are starting to respond. Buyers’ agents have seen more homes selling before auction day and more homes selling by negotiation after being passed in, Jennison says.

Melbourne and Sydney buyers are also starting to offer lower prices instead of agreeing to pay whatever the seller asks, she says.

“Buyers are in the driving seat [because] the seller might not actually have five other buyers that are interested in that home,” Jennisons says.

Domain data shows direct negotiation by private treaty has crept up in Melbourne over March, with private treaty sales about 2,000 a week to 2,400 a week.

In Sydney, though, homes selling by private treaty have been stuck on the market for longer, according to Ray White’s head of auctions for Sydney, David McMahon.

McMahon says the better path would be to have another go, with Ray White data suggesting homes that pass in tend to succeed at a second auction. Owners of a failed first auction have not grown more willing to test that theory in today’s market, he says.

“Owners are probably not as confident to auction a property again,” McMahon says. “The depth and the energy has come out of the market.”

More often, people have started to cut their prices, McMahon says. He’s trying to sell his own place in Sydney’s Sutherland shire and has seen just seven buyers attend his open home, instead of the 20 he would have expected.

“We wanted $1.6m but $1.6m is clearly not there any more: should we maybe be considering $1.58m, $1.57m, $1.56m?” he says.

A growing number of homes are instead being taken off the market before auction day even arrives, with Sydney seeing 20% of homes withdrawn before auction in the last week of March – its highest rate since 2022. Preliminary Cotality data suggests the city’s withdrawal rate has since climbed to 30%.

Alice Stolz, from property marketplace Domain, says it’s a sign sellers are starting to get “cold feet”, which will bring listing numbers back down.

“A vendor who hasn’t got the nerve to take it to auction and potentially have no bidders turn up … rather than rolling the dice, they just take it back off the market,” Stolz says.

“There are a small component that that will have to sell but there are … other vendors who have got essentially all the time in the world and will wait for the market to rebound.”