In 2025, Melbourne is once again at the centre of attention for both homebuyers and investors. After experiencing cooling in 2023–2024, the city’s property market is showing strong signs of stability — and selective areas are already trending upward.
In this deep-dive cornerstone article, we’ll walk through:
- What’s happening in Melbourne’s real estate market right now
- Where prices are heading next (and why forecasts differ)
- Which suburbs still offer value in a rising market
- What Singapore-based investors should know before buying
📊 Current Price Movements in Melbourne
According to CoreLogic’s latest February 2025 data:
- Melbourne’s median dwelling value is approximately $772,561
- Monthly change: +0.4%, ending 10 months of steady decline
- Rental growth remains strong in outer-ring suburbs (5–7% YoY)
💬 Cilla’s Take: “We’re seeing renewed confidence in the west and southeast corridors. Yields are holding, and buyer enquiries are increasing — especially from Singapore-based families and first-time overseas investors.”
🔮 Forecasts: Where Are Prices Heading in 2025–2026?
Different analysts paint different pictures for Melbourne’s trajectory:
Source | 2025 Forecast | 2026 Forecast | Notes |
KPMG | +3.5% | +6.0% | Sees affordability-driven growth in middle suburbs |
SQM Research | –5% to +2% | Unclear | Warns about oversupply in inner apartments |
NAB Housing Insights | +4.0% | +5.5% | Highlights rising migration and limited listings |
📌 Tip: Focus less on citywide averages and more on micro-markets with clear upside.
🏙️ Melbourne Suburb Comparisons (2025 Highlights)
Suburb | Median Price (House) | YoY Growth | Rental Yield | Key Feature |
Werribee | $630,000 | +4.2% | 4.8% | Growth corridor, schools, new infrastructure |
Sunbury | $660,000 | +5.9% | 4.6% | $2B town centre, rail upgrades |
Fitzroy | $1.42M | –2.1% | 2.9% | Lifestyle hub, close to CBD |
Tarneit | $675,000 | +6.4% | 4.9% | High demand, culturally diverse |
Box Hill | $1.33M | +1.1% | 3.1% | Asian investment hotspot, major transport link |
💡 Luke’s Note: “Buyers looking for dual-income potential or newer builds with depreciation perks should focus on areas like Tarneit and Werribee. These aren’t just affordable — they’re scalable.”
💡 Investor Insights for Singapore-Based Buyers
- Stamp Duty Surcharge: Foreign buyers in VIC face an 8% surcharge, in addition to standard stamp duty.
- Rental Yields: Melbourne’s outer suburbs offer up to 5% gross yield, often higher than Sydney.
- Finance from Abroad: Many lenders in Australia will accept Singapore-based income with proper documentation.
- Best Strategy: Consider house & land packages in emerging estates that qualify under FIRB rules.
📍 Where Smart Money is Headed
- Southeast Growth Belt: Cranbourne, Clyde North, Pakenham — strong infrastructure, high demand
- West Melbourne: Truganina, Tarneit, Werribee — transport links and new schools drive growth
- Middle Ring Revivals: Areas like Preston, Heidelberg, and Glenroy offer gentrification upside
📌 Watch for rezoning activity and major developments in these areas.
🏦 Deeper Dive: What’s Driving Melbourne’s Resilience in 2025
While interest rates remain elevated compared to pre-pandemic years, Melbourne’s market resilience stems from several structural and behavioural shifts:
1. Net Migration Surge
After years of halted movement during COVID-19, Victoria is now regaining interstate and international migrants. This population recovery is fuelling demand for both rental and owner-occupier housing — especially in family-friendly and transport-accessible zones.
2. Chronic Undersupply in Key Areas
Although headlines focus on oversupply in inner-city apartments, detached homes in middle to outer suburbs remain scarce. With construction costs still high and builder insolvencies affecting timelines, new stock isn’t coming fast enough.
3. First Home Buyer Support
State and federal initiatives like stamp duty exemptions and shared equity schemes are supporting younger buyers, especially in suburbs under the $800,000 price threshold.
4. Investor Repositioning
Savvy investors are diversifying — selling high-maintenance inner units and reinvesting into growth-likely land-rich suburbs, especially in the west and southeast.
💬 Cilla’s Tip: “Look for suburbs that were undervalued during the 2022–2024 cooling period. These are now the quiet achievers showing 4–6% growth with rental queues down the block.”
Understanding how Melbourne property has performed over time helps put current prices into context:
Year | Median Dwelling Price | Annual Change |
2020 (Pre-COVID boom) | $681,000 | +5.8% |
2021 (COVID stimulus peak) | $795,000 | +11.8% |
2022 (Rate hike response) | $752,000 | –5.4% |
2023 (Cooling/stabilisation) | $765,000 | +1.7% |
2024 (Correction phase) | $765,800 | 0.0% |
2025 (current) | $772,561 | +0.4% |
This suggests the market is now entering a new growth cycle — with values holding steady despite inflationary and lending pressures.
🧳 Case Study: Buying from Singapore — Southeast Melbourne
📚 Practical Tips Before You Buy
1. Use Time Zone Advantage for Virtual Inspections
Singapore’s time zone is only 2–3 hours behind Melbourne. That means you can easily schedule real-time walkthroughs or video calls with agents during your weekday evenings or weekends — no late nights required.
2. Beware of Off-the-Plan Pitfalls
While many new builds are FIRB-approved, not all offer long-term value. Always check:
- What stage the build is at
- Developer reputation and delivery timelines
- Body corporate fees (these eat into yield)
3. Factor in Property Management Early
Appointing a property manager before settlement ensures faster tenant placement. Good managers pre-list and start advertising weeks before you take ownership — reducing vacancy time.
4. Don’t Overlook Tax Planning
Buying from Singapore? Make sure you:
- Set up an Australian tax file number (TFN)
- Understand non-resident tax rates (no tax-free threshold)
- Claim depreciation and expenses to offset rental income
🙋♂️ FAQs for Singapore-Based Buyers
Q1: Can I buy a second property in Melbourne as an overseas investor?
Yes, but every purchase must go through the FIRB process. Each property is reviewed independently, and surcharges apply each time.
Q2: What if I plan to move to Australia later — should I buy now?
Many Singapore-based clients buy with future migration in mind. Purchasing early allows you to lock in prices and potentially rent out the property until you’re ready to move.
Q3: Can I get a home loan using my SGD income?
Yes — many Australian banks and non-bank lenders accept Singapore income. However, your LVR (Loan to Value Ratio) may be lower, typically 60–70% for overseas borrowers.
Q4: What kind of property holds value best in Melbourne?
Land-rich homes (with a title) in established or emerging suburbs tend to outperform apartments long-term. Look for scarcity, infrastructure, and proximity to employment hubs.
Client: Solo investor, late 30s, based in Singapore with SGD income
Goal: High-rentability 3-bedroom home in a growing suburb
Location: Clyde North, VIC
- Price: $649,000 AUD
- Rental appraisal: $580/week
- FIRB approved; settled remotely in 75 days
Outcome? The property was rented out within 9 days of settlement, generating a 4.6% gross yield and positioned for long-term growth.
“Melbourne is layered. It’s not just about finding what’s growing — it’s about finding what’s undervalued and growing. We help clients see past the headlines and into the next wave of smart property opportunities.”
Let’s Build Something Together
At PropertyNXT, we’re more than agents — we’re your partners in building long-term wealth. Whether you’re buying your first overseas property or adding to a growing portfolio, Cilla & Luke are here to guide you every step of the way.
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