Is The Melbourne Property Market Finally Turning A Corner?
In This Week’s How's The Market | Edition 111
Is The Melbourne Property Market Finally Turning A Corner?
Listings Are Back!
One Of The Most Significant Terrace Homes In Melbourne
Is The Melbourne Property Market Finally Turning A Corner?
After a sluggish run over the past couple of years, there are early signs that Melbourne’s housing market might be shifting gears.
So far in 2025, we’ve seen three consecutive months of price growth.
On its own, that might not sound like big news - but considering how the market performed in 2024, it's a meaningful change.
Prices fell through much of last year, ending 2024 down 2%.
What’s been particularly interesting about Melbourne is just how differently it’s behaved compared to the rest of the country.
Since the RBA began lifting interest rates in 2022, most markets have adjusted in their own way. Sydney, while not booming, has seen steady growth. But Melbourne? It largely moved sideways - or declined.
In fact, prices here are still 3.3% lower than they were back in May 2022.
Meanwhile, the smaller capitals have been powering ahead. Perth leads the pack with a huge 43% growth in home prices over the past three years.
Brisbane and Adelaide have also surged, relatively unaffected by rising rates.
As a result, we’re now seeing something that would’ve seemed unlikely just a few years ago - median home prices in Perth, Adelaide, and Brisbane are now on par with, or even higher than, those in Melbourne in some sections.
The gap between Sydney and Melbourne has also never been wider.
We are now hearing for the first time in a long time that Melbourne is looking relatively affordable to the rest of the country which is bringing more investors in from other states.
We have seen a HUGE uptick in interstate activity over the last 3 months on the ground.
For much of the 2010s, Melbourne sat well above the smaller capitals in price, often 20–40% more expensive. That dynamic has shifted and savvy buyers are starting to take notice.
With momentum returning locally and price growth in the other capitals beginning to ease, there’s a real chance Melbourne could start to narrow that gap again.
Of course, it’s still early days but if you’re thinking about buying in Melbourne at some point over the next year, I’d be recommending you speak to a mortgage broker and start preparing your finances so that you can move quickly if a great opportunity presents itself.
What The Agents Are Saying
Listings are back!
This week we have seen a large increase in stock and agents are looking like their weekends are going to be a lot busier than usual.
Interestingly, this means that some agents are willing to do quick deals in order to now clear their stocklist.
We bought a property off-market this week the day before it was scheduled to be listed online.
It was a good offer and that meant that the agents were willing to bat for us as it provides their vendor certainty on price without running an auction campaign, plus means they don’t have to run these open for inspections twice a week for the next month.
I think we will see a lot more stock coming on over the next fortnight too and a lot more auctions beginning to take place in 2 to 4 weeks time.
The Wow Factor!
99 Drummond Street, Carlton, Vic 3053
An epic opportunity!
One of the most significant terrace homes in Melbourne and one of only 7 in this row on Drummond St.
A large renovation will be needed to turn this into a modern home from its current setup as an office site.
The facade, height & position are all wow factors here.
Price Guide: $5,500,000 - $6,000,000
In The Media
“Victorian home approvals plunged in March, with the number of apartments, houses and units being green lit by authorities dropping by more than 1500 from February.”
We are running consistently behind our target for building new homes and it seems to be getting worse.
This along with interest rates dropping paints a pretty good picture for price growth.
Final Thoughts
Melbourne seems to be undervalued on a national level.
Combine this with a drop in new building approvals and potential interest rate drops this year and it looks like we could be turning a corner for the remainder of 2025.
If you or someone you know would like assistance to buy this year, book in a call and we can discuss if we can help.
Thanks for reading this far!
We value feedback and if you have any suggestions on what you would like covered in the future please email me at tristan@tomii.com.au
Happy Buying!
Note: This is general advice and does not take into consideration your objectives, situations or needs. Please consider if this advice is suitable for you and your circumstances and speak to a professional before making any financial decisions.
