With auction clearance rates at six-year lows, PropCred's modelling puts the most likely outcome at high single-digit falls in Sydney and Melbourne, with a material chance of a deeper correction if rates rise again

MELBOURNE, Australia, July 1, 2026 /PRNewswire/ -- Australia's combined auction clearance rate has fallen to 47.4%, its lowest level since the pandemic lockdowns of April 2020. The real question for buyers and sellers, says property intelligence platform PropCred, is no longer whether prices are falling, but how far.

PropCred's research models three scenarios for the next 18 months, weighted by probability rather than presented as a single forecast.

The most likely path, assigned a 45% probability, is an orderly correction: house prices easing roughly 5 to 8% in Sydney and 7 to 10% in Melbourne from current levels, as the recent negative gearing and capital gains reforms are absorbed gradually thanks to grandfathering provisions protecting most existing investors.

A 35% probability extended pressure scenario sees further Reserve Bank rate rises pushing falls to 10 to 14% in Sydney and 12 to 16% in Melbourne, as post-reform investors face a fixed timetable to exit before tighter tax treatment applies from mid-2027.

PropCred assigns a 20% probability to a soft landing, in which an earlier than expected rate cut cycle limits falls to low single digits, or even supports modest growth in Brisbane, Perth and Adelaide.

Sydney dwelling values are already down 2.1% from their November peak, with a median of $1,282,020. Melbourne has fallen 3.2% from its 2022 high to around $995,000, within reach of the $1 million threshold.

"The gap between our base case and our downside scenario isn't marginal," said Matt Proctor, Principal Analyst at PropCred. "On a $1.5 million Sydney home, it's roughly $90,000. Buyers and sellers need to know which scenario their suburb and property type are actually tracking toward, not just the national headline."

PropCred identifies the spring listing season, particularly clearance rates in September, as the key signal: a recovery above 60% would support the soft landing case, while a slide below 53% would point toward the deeper correction.

PropCred publishes free property-specific analysis covering most newly listed homes for sale in Australia at propcred.com/property, alongside paid analyst-reviewed reports for buyers, sellers and owners.

Source: PropCred Research, "How Far Will Australian Property Prices Fall?" https://propcred.com/how-far-will-australian-property-prices-fall/

About PropCred
PropCred is a Melbourne-based property intelligence platform helping Australians assess fair value, market evidence, rental yield, growth indicators and property-specific risk.

Media Contact
Matt Proctor, Principal Analyst, PropCred
Phone: +61 410 187 474
Email: 417884@email4pr.com
Website: https://propcred.com

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SOURCE PropCred