Cotality's national Home Value Index fell 1.2% in October, extending the downturn to a seventh consecutive month, while the Reserve Bank's cash rate sits at 4.85%, its highest level in 18 years, following the fifth hike of 2026. According to Property Update's Michael Yardney, writing on November 8, 2026, the pace of this decline is faster than any downturn in the past 40 years, with capital city values down 8.1% in seven months. Suburb-level data tells a sharper story still: REAStats records Nedlands in Western Australia clearing 65.5% of auctions against Port Macquarie in New South Wales at just 46% — a gap that sits squarely inside the auction-clearance signal Yardney flags as his fourth marker of a turning market, though he also cautions that suburb-level data can mislead investors if it's cherry-picked rather than read consistently over time.
Where Cotality's Numbers Actually Sit
The headline figures are not soft. Sydney house and apartment prices are now 10.1% below their February 2026 peak, having weakened steadily through the year, while Melbourne has dropped 2.7% over the past three months and remains 8.2% below its March 2022 peak. National sales volumes over the past three months are running 19.1% below the same period a year earlier, and capital city homes now take a median of 39 days to sell, up from 23 days twelve months ago. Cotality's Tim Lawless is quoted in the same piece suggesting a peak-to-trough fall of 10% to 15% is a reasonable estimate for this cycle.
For broader market context, see WealthWatchPro macro and interest rate analysis.
Yet the picture is not uniform. Perth values remain roughly 3.9% higher than a year ago and Darwin is up almost 9.7%, even as Sydney and Melbourne post annual falls above 9.7% and 7.6% respectively. Yardney's own measure of breadth — the share of capital city suburbs recording value falls, currently 97% — is one of the clearest early-warning gauges he tracks, because a meaningful drop in that percentage would signal the downturn losing grip well before the headline index turns positive.
The Six Signals, in the Order They Tend to Arrive
Yardney's framework moves from leading to lagging indicators. First, interest rate expectations need to stabilise — not necessarily cuts, but confidence that hikes have stopped, since in the 2022-23 cycle national values bottomed in early 2023 while the RBA was still raising rates through to November that year. Second, buyer sentiment measures such as the Westpac-Melbourne Institute "time to buy a dwelling" index need to trend higher for several consecutive readings. Third, ABS lending data needs to show a sustained lift in new home loan commitments, particularly among owner-occupiers, which mortgage brokers typically notice before the official figures catch up.
Fourth comes auction clearance rates holding, not spiking, at a higher level. Yardney treats results in the high 50s as roughly balanced and anything consistently above 60% as a market where prices are rising — the emphasis being on consistency over several weekends rather than one strong Saturday skewed by thin volumes. Fifth is the "coalface" shift: more registered bidders, fewer passed-in properties, shrinking vendor discounts and agents becoming less willing to accept long finance clauses. Sixth and last are the price indices themselves, with Cotality's daily measure typically flattening before the monthly Home Value Index, and ABS figures confirming the turn later still.
Where REAStats Suburb Data Already Shows the Split
Applying Yardney's fourth signal — clearance rates holding above the high-50s threshold — to REAStats suburb data produces a telling map. Nedlands posts a 65.5% clearance rate with a median of $2.2 million and a 15-day selling cycle, alongside 15% annual growth, putting it comfortably inside Yardney's "rising" band. Randwick in Sydney's eastern suburbs clears 73.5% of auctions with a 23-day cycle, while South Perth clears 63.5% with 13.8% annual growth and just 17 days on market. Toorak, at the premium end of Melbourne, clears 72%.
Randwick clears 73.5% of auctions compared with Port Macquarie's 46%, a 27.5-percentage-point gap that illustrates how unevenly auction conditions are running even within New South Wales.
By contrast, Dandenong in Melbourne's south-east clears 56% with only 2.3% annual growth and a 40-day selling cycle, and Port Macquarie on the NSW Mid North Coast sits at 46% clearance with 48 days on market. REAStats's own national clearance rate reading of 68.8% as of October 19, alongside Sydney at 70.8%, Melbourne at 68.8% and Brisbane at 67.2%, sits well above the "stuck in the 40s" range Yardney describes nationally — a reminder that clearance methodologies and timing windows can tell different parts of the same story depending on which markets and weeks are captured. What's consistent across both data sets is the pattern: premium, well-located suburbs are clearing faster and at higher rates than outer or regional markets carrying heavier stock overhangs. Yardney himself warns that suburb-level data is one of the signals that can lead investors astray if it's cherry-picked to tell a story, or if an anecdote about a single distressed sale gets repeated as if it represents the whole market — a caveat worth holding onto when reading comparisons like these.
Why Clearance Rates Lead Rather Than Confirm
Auction clearance rates function as a real-time sentiment gauge precisely because they reflect decisions made this week, not settlements recorded six weeks ago. Our clearance rate explainer sets out why a reading in the high 50s to low 60s generally signals a balanced market, and why investors should also check withdrawal rates and auction volumes rather than relying on the headline percentage alone — a thin Saturday with few listings can produce a misleadingly strong number. Buyers assessing reported guide prices against eventual clearance outcomes should also understand how quoting practices can distort these figures; our guide to auction underquoting in Australia covers the state-by-state rules and how to spot a guide that doesn't match genuine vendor expectations.
Broader rate-cycle context matters too. Investors trying to time entry against the RBA's tightening path should note that in the 2022-23 cycle, national values bottomed in early 2023 while the RBA kept hiking through to November that year — a gap of several months between prices troughing and the central bank's own rate stance catching up.
What This Means for Agents, Buyers and Vendors
Yardney's central warning is that waiting for every signal to align — rate stability, rising sentiment, lending growth, consistent clearance rates, coalface momentum and positive price indices — usually means paying more and competing harder, because by the time all six confirm, vendors have regained leverage and buyers have returned en masse. For agents, the practical implication is tracking clearance rate consistency and withdrawal volumes in their own patch rather than relying on national headlines; the Nedlands-Randwick-Toorak cluster already shows what that signal 4 threshold looks like at the suburb level, while Dandenong and Port Macquarie illustrate where stock absorption remains the binding constraint. For buyers and vendors, the message is less about calling the exact bottom and more about recognising that, as Yardney puts it, the best buying conditions typically exist while the market still feels uncomfortable — not after it's obviously turned.
