If auction clearance rates are any indicator, Sydney's residential property market is cooling with the weekend auction rate falling to a three-year low. The city's auction clearance rate dropped below 60 per cent for the first time, at 59.2 percent across 1011 scheduled auctions. This was well down on the previous weekend's result of 64.4 percent, and the big four banks all hiking their interest rates.

Domain Group senior economist Dr Andrew Wilson warns that Sydney could fall even further by Christmas, saying, "It's not just that the market is tracking at its lowest levels in three years in Sydney but that we are also yet to find a floor. This has been a very sharp decline, we are not seeing an orderly correction phase. But we still have around 6000 auctions to come in Sydney before the end of the year."

Melbourne's weekend auction clearance rate was 70 per cent, compared with 66 percent the week before.

Brisbane had a clearance rate of 35 percent for 57 reported auctions, while Adelaide saw a 67 percent clearance rate for 62 reported auctions. In Canberra, the auction clearance rate was 74 percent for 68 reported auctions.