Melbourne Property Market – Prices, Trends, Forecast [September 2025]

Melbourne’s recovery remains measured, with values edging +0.3% in August. The city is still ~3.0% below its prior peak (set in Mar-22), and the median dwelling value sits near $809k, keeping affordability relatively better than Sydney and Brisbane.

Market Highlights

• Values up 0.3% in August; median around $809k; still 3.0% below peak (Mar-22).
• Past 3 months +1.0%; ~1.4% y/y; +2.7% since the Feb rate cut; ~16.8% over five years.
• Rental growth soft: house rents ~1.1% y/y; unit rents ~1.5% y/y; gross dwelling yields ~3.7%.
• Standout pockets (12-mo growth): Frankston (~8.3%), Tullamarine–Broadmeadows (~6.0%), Dandenong (~5.0%), Keilor (~4.9%), Brimbank (~4.8%).
• Outlook: gentle gains likely from a low base; affordability and cautious lending to keep the pace measured.

Housing Metrics Overview

See how Melbourne’s property values have performed across houses and units over various timeframes, along with returns, yields, and median prices.

Watch CoreLogic’s August 2025 Housing Market Update for expert commentary on national and capital city housing trends, price movements, and key market drivers across Melbourne.

Melbourne Property Price Growth

Momentum is steady rather than swift: roughly 1.0% over three months and about 1–2% over the year. Over a longer lens, values are ~16.8% higher than five years ago, and up ~2.7% since the first rate cut in February.

View the latest property value movements across Australia’s capital cities. Use the filters to explore monthly, quarterly, and annual changes by dwelling type and region. Data sourced from CoreLogic.

Melbourne Property Market Trends

• Investor returns remain lean but a touch stronger than Sydney, with gross dwelling yields around 3.7%.
• Rental conditions have been among the softest of the capitals (house rents ~1.1% y/y; unit rents ~1.5% y/y), though the pulse is starting to re-accelerate.
• Local out-performers over the past year include Frankston (~8.3%), Tullamarine–Broadmeadows (~6.9%) and Dandenong (~5.0%), pointing to resilience across selected middle- and outer-ring markets.

The table outlines CoreLogic’s Home Value Index as of 1st September 2025, showing peak declines, five-year growth, and changes since the first rate cut in February.

Melbourne Property Market Forecast

Into spring, a lift in listings from a low base should be met by steady buyer demand. Gains are likely to remain modest as affordability and prudent lending temper the cycle; rental growth is expected to firm gradually from recent lows, supporting yields at the margin.

The Reserve Bank of Australia’s ongoing adjustments to interest rates will likely play a crucial role in shaping market dynamics, as higher borrowing costs limit purchasing power for many buyers.

Here are some of the most recent forecasts by the big-4 banks in Australia:

• ANZ predicts a 5-6% increase in capital city property prices in 2024, with Brisbane expected to see the highest rise at 9-10%, Perth property values could go up by 1-11%, Sydney by 4-5%, and Melbourne prices by 2-3%.
• CBA forecasts a 5% rise in capital city prices, with some variations: Brisbane is anticipated to grow by 6%, Melbourne and Perth by 5%, Sydney by 4%, and Adelaide by 1%.
• NAB projects a 5.4% average increase across the capitals, with Brisbane expected to see a 6.5% rise, Perth and Adelaide by 6.2%, Melbourne by 5.5%, Sydney by 5%, and Hobart remaining flat.
• Westpac expects a 6% growth across the combined capitals, with Perth leading at 10%, followed by Brisbane at 8%, Sydney at 6%, Adelaide at 4%, and Melbourne at 3%

Oxford Economics recently released property forecasts predicting where house prices will be in three years.

Conclusion for Homeowners

Melbourne is in a slow-and-sure upswing: prices are rising gently, rental momentum is rebuilding, and a handful of SA3s are outperforming. The near-term path points to incremental growth rather than a surge, with fundamentals improving but not overheated.

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