Auction clearance rates have climbed — but there's a 'brutal reality' behind the bounce

Industry figures say fewer listings, more realistic seller expectations and fewer properties competing for buyers can push clearance rates higher even while broader market conditions remain soft.They say higher interest rates have reduced buyers' borrowing capacity, while economic uncertainty and recently legislated tax changes affecting property investors have also weighed on confidence.Sydney recorded a preliminary clearance rate of 57.5 per cent from 452 auctions, up almost six percentage points from the previous week Melbourne's rate rose 1.7 percentage points to 56.2 per cent across 585 auctions.But clearance rates remain weak by historical standards and property experts have urged caution, saying it was too early to tell whether last week's uptick reflected a broader trend.Real Estate Institute of Australia president Jacob Caine said the auction market was still adjusting to uncertainty."The brutal reality is that the auction market in general is relatively flat compared to recent historical performance," he said."The external factors around tax, around policy, around international concerns are creating uncertainty