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Melbourne's property market in 2025 shows a median house price of approximately $940,000-$983,000, with units averaging $614,000-$617,000. The market has stabilized after recent volatility and is showing signs of modest recovery with prices beginning to turn positive after a challenging period.
Melbourne remains Australia's second most expensive capital city property market after Sydney, but offers better value compared to international cities like London or New York. Property prices vary dramatically across suburbs, with inner-city areas commanding premiums while outer suburbs offer more affordable entry points for both investors and owner-occupiers.
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Melbourne's median house price stands at $940,000-$983,000 as of 2025, with units at $614,000-$617,000. The market is recovering from recent declines with modest price growth expected in the coming year.
Property prices vary significantly by location and type, with inner suburbs commanding premiums while outer areas offer better value. Total buying costs including taxes and fees can add $50,000-$250,000 to the purchase price.
| Property Type | Median Price (2025) | Annual Growth |
|---|---|---|
| Houses | $940,000-$983,000 | 0-2% (stabilizing) |
| Units/Apartments | $614,000-$617,000 | Slightly negative to flat |
| Townhouses | ~$617,000 | Similar to units |
| All Dwellings | $791,000-$803,000 | Modest positive growth |
| Most Expensive Areas | $1.5M+ (Toorak, Brighton) | Premium market resilience |
| Budget Areas | $470,000-$560,000 | Steady demand |
| Projected 2026 | $1.05M-$1.16M (houses) | 2-6% expected growth |
What's the current average property price in Melbourne?
As of September 2025, Melbourne's median house price ranges from $940,000 to $983,000, representing a stabilization and modest recovery from previous declines.
The median unit or apartment price sits at approximately $614,000 to $617,000, while townhouses typically price around $617,000. The overall median dwelling price across all property types is estimated at $791,000 to $803,000.
These prices reflect Melbourne's position as Australia's second most expensive capital city property market after Sydney. The market has shown signs of stabilization in recent months, with annual growth turning positive after a challenging period.
Property values vary significantly across Melbourne's diverse suburbs, with inner-city areas commanding substantial premiums while outer suburban areas offer more accessible entry points for both first-home buyers and investors.
It's something we develop in our Australia property pack.
How do prices differ by property type?
Melbourne's property market shows significant price differentiation between property types, with houses commanding the highest premiums followed by townhouses and units.
Houses maintain a substantial price gap over apartments and units, with median prices ranging from $940,000 to $983,000 compared to units at $614,000 to $617,000. This represents approximately a 50% price premium for houses over units.
Townhouses typically price closer to high-end units at around $617,000, though this can vary significantly based on location and quality. In outer areas, townhouses may overlap with house prices depending on size and amenities.
The price differential reflects several factors including land value, privacy, potential for renovation or extension, and lifestyle preferences. Houses offer greater space, private outdoor areas, and development potential that many buyers value highly.
What are the average prices in different Melbourne neighborhoods?
Melbourne's property prices vary dramatically across neighborhoods, creating distinct tiers of affordability and investment opportunity.
| Suburb Category | House Price Range | Unit Price Range |
|---|---|---|
| Premium Inner (Toorak, Brighton) | $1.5M - $3.6M+ | $800K - $1.2M+ |
| Middle Ring (Avondale Heights) | $930K - $950K | $535K - $620K |
| Outer Ring (Pakenham) | $560K - $950K | $427K - $608K |
| Budget Areas (Melton, Doveton) | $470K - $560K | $350K - $396K |
| Emerging (Noble Park, Doreen) | $570K - $760K | $445K - $560K |
Inner-East, Bayside, and established inner-city suburbs often exceed $1.5 million for houses, with premium areas like Deepdene reaching $3.6 million. Budget-friendly options in far western, northern, and southeastern suburbs offer houses for $470,000 to $560,000.
How do property prices change based on size and location?
Property prices in Melbourne reflect a clear relationship between size, location, and value, with proximity to the CBD commanding significant premiums per square meter.
Inner-city properties around $950,000 typically offer smaller homes on compact blocks, such as a renovated 3-bedroom house on 276 square meters near the CBD. The same budget in middle-ring suburbs buys substantially larger properties, potentially 711 square meters with development potential.
Outer-ring areas offer the best value for space, where $950,000 can secure a modern 4-bedroom house with pool on 768 square meters. This represents approximately triple the land area compared to inner-city equivalents at the same price point.
For units, inner-urban 2-bedroom, 1-bathroom properties with 2-car spaces located 7 kilometers from the CBD typically cost around $620,000. Outer units offering larger floor plans or additional bedrooms often cost less despite increased space.
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What's the typical total cost of buying a property in Melbourne?
The total cost of buying property in Melbourne extends well beyond the advertised purchase price, with additional expenses potentially adding $50,000 to $250,000 to your budget.
Stamp duty represents the largest additional cost, estimated at approximately $50,000 to $55,000 for a $940,000 property, though this varies based on concessions and first-home buyer eligibility. Government charges and taxes can be particularly substantial on new builds, potentially reaching 32% of an apartment's price or $236,000 on premium properties.
Professional services include conveyancing and legal fees ranging from $1,500 to $3,000, building and pest inspections, and potential mortgage insurance if your deposit is less than 20%. Lender fees and establishment costs add further expenses to consider.
Ongoing costs include council rates, land tax which can reach 1.5% annually on high-value properties, and possible vacant land tax for unoccupied land. These recurring expenses significantly impact the long-term affordability of property ownership.
What would monthly mortgage payments look like for an average Melbourne property?
Monthly mortgage payments for Melbourne properties reflect current interest rates of approximately 6% to 6.23% over typical 30-year loan terms.
The typical monthly repayment in Victoria averages around $3,700 to $3,860 for standard mortgage sizes, based on principal and interest calculations. For a $940,000 house with a 20% deposit of $188,000, the resulting $752,000 mortgage would require monthly payments of approximately $4,700.
These calculations assume current market interest rates and standard lending terms. Many first-home buyers enter at lower price points or provide larger deposits, resulting in smaller loan amounts and more manageable monthly payments.
It's important to factor in additional monthly costs including council rates, insurance, and maintenance when calculating total housing expenses. These can add several hundred dollars monthly to your budget beyond the mortgage payment.
Can you provide example purchase prices for different Melbourne suburbs?
Melbourne's diverse suburbs offer vastly different value propositions at similar price points, demonstrating the importance of location strategy.
| Location | Property Example | Price |
|---|---|---|
| Kingsville (Inner) | 3-bed house, 276sqm | $950,000 |
| Avondale Heights (Middle) | 3-bed house, 711sqm | $940,000 |
| Pakenham (Outer) | 4-bed, 2-bath, pool, 768sqm | $950,000 |
| Brunswick East | 2-bed unit, 2-car, 7km CBD | $620,000 |
| Clyde | 3-bed unit, 2-bath, 55km out | $608,000 |
| Laverton | Standard house | $572,500 |
| Meadow Heights | Family home | $570,000 |
These examples illustrate how budget allocation affects property size, location, and amenities. Inner suburbs prioritize location over space, while outer areas maximize property size and features for the same investment.
Which areas are most expensive, budget-friendly, and up-and-coming?
Melbourne's property market segments into distinct categories based on price points and growth potential, each offering different investment and lifestyle opportunities.
Most Expensive Areas:
- Deepdene: $3.6 million median, grew $602,000 in 2024 alone
- Toorak: Established luxury with consistent premium pricing
- Brighton: Bayside prestige commanding $1.5 million plus
- Kew: Inner-east established suburb with heritage appeal
- Hawthorn: Close to CBD with excellent amenities
Budget-Friendly Areas:
- Melton: Houses from $470,000 with growth infrastructure planned
- Norlane: Geelong proximity with affordable entry points
- Doveton: Southeastern value with improving transport links
- Wonthaggi: Coastal location with $530,000 median
- Meadow Heights: Northern growth corridor affordability
Up-and-Coming Areas:
- St Kilda East: Inner location with relative affordability
- Noble Park: Strong value growth potential versus neighbors
- Doreen: Infrastructure development and family appeal
- Craigieburn: Northern growth corridor with transport improvements
- Werribee: Western growth with major infrastructure investment
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What are the smartest buying choices for different investment goals?
Your property purchase strategy should align closely with your intended use and investment timeline, as different goals require different location and property type considerations.
For owner-occupiers planning to live in the property, middle and outer ring suburbs offer superior value with larger or newer homes at median prices. These areas are less susceptible to sharp market downturns and provide better lifestyle amenities per dollar spent.
Short-term rental investors should focus on apartments or houses in inner-city locations near universities, major event venues, and tourist attractions. Areas like Brunswick, Carlton, and St Kilda offer the strongest short-term rental demand with premium pricing potential.
Long-term rental strategies work best in growth areas experiencing strong population increases through immigration or infrastructure development. Doreen, Craigieburn, and Werribee present excellent opportunities for sustained rental demand and capital growth.
For resale-focused investments, target established suburbs with ongoing infrastructure development or where current values lag behind neighboring premium suburbs. This strategy capitalizes on value convergence over time.
It's something we develop in our Australia property pack.
How have Melbourne property prices changed over recent years?
Melbourne's property market has experienced more moderate growth compared to other Australian capitals over the past five years, creating potential opportunities for future appreciation.
Compared to 2020, Melbourne house prices have increased approximately 14%, while units have grown around 7%. This performance significantly lags behind Brisbane, Adelaide, and Perth, which experienced growth of 30% to 75% over the same period.
Over the past year compared to 2024, house prices have stabilized with modest increases of 0% to 2%, while units have remained slightly negative to flat. This stabilization follows a period of decline and suggests the market is finding its equilibrium.
Melbourne's relatively restrained growth creates a more stable environment for buyers and suggests less speculative activity compared to other capitals. This measured growth pattern may indicate better long-term sustainability and reduced bubble risk.
What are the price forecasts for Melbourne property?
Melbourne property price forecasts suggest gradual but sustained growth over the coming decade, with house prices potentially reaching $1.23 million to $1.6 million by 2030.
| Timeframe | Forecasted House Price | Expected Growth |
|---|---|---|
| Current (2025) | $940,000-$983,000 | Baseline |
| 2026 (1 Year) | $1.05M-$1.16M | 2-6% annual growth |
| 2030 (5 Years) | $1.23M-$1.6M | $330K-$660K increase |
| 2035 (10 Years) | $1.8M-$2.4M* | 4-6% annual compound |
Short-term forecasts for 2026 expect market growth of 2% to 6%, depending on suburb and property type. This represents a return to positive growth after recent market adjustments.
Medium-term projections to 2030 suggest house medians could reach $1.23 million to $1.6 million, representing potential gains of $330,000 to $660,000 above current levels. Long-term growth may moderate to 4% to 6% annually, more sustainable than historical 7% to 8% rates.
How do Melbourne prices compare with other major cities?
Melbourne's property market occupies a middle position among major Australian and international cities, offering better value than Sydney while remaining more expensive than most other capitals.
Sydney maintains its position as Australia's most expensive property market with house medians around $1.47 million and units at $857,000. This represents approximately a 50% premium over Melbourne for comparable properties.
Brisbane has emerged as a strong performer with house medians around $1.01 million and units at $718,000, recently experiencing stronger growth and outperforming Melbourne. Brisbane's growth trajectory suggests it may challenge Melbourne's pricing in coming years.
Internationally, Melbourne remains more affordable compared to global cities like London, New York, and Hong Kong, but commands premium pricing versus most US mid-tier cities and Asian capitals. This positioning makes Melbourne attractive for international investors seeking developed market exposure.
Melbourne's relative affordability compared to Sydney, combined with its cultural amenities and economic diversity, continues to attract both domestic and international property investment.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Melbourne's property market in 2025 presents a stabilizing environment with median house prices around $940,000-$983,000 and units at $614,000-$617,000.
The market offers diverse opportunities across price points, from budget-friendly outer suburbs starting at $470,000 to premium inner areas exceeding $1.5 million, with modest growth expected in the coming years.
It's something we develop in our Australia property pack.
Sources
- Real Estate - Melbourne House Prices 1M Median Milestone
- OpenAgent - Melbourne Property Market
- Property Buyer - Melbourne Property Prices by Suburb 2025
- Your Mortgage - Median House Prices Around Australia
- Real Estate - Undervalued Melbourne Suburbs Property Boom
- OpenAgent - Cheapest Suburbs to Buy in Melbourne
- Entry Conveyancing - Hidden Costs of Buying a House
- PWC - Australian Stamp Duty and Land Tax Maps
- HIA - Taxes and Regulatory Costs Victorian Housing Affordability
- Money - Home Loan Statistics