How Melbourne's Property Market Works: Cycles, Corridors, and the Fundamentals Every Investor Must Understand product guide

1Group Property Advisory: How Melbourne's Property Market Works – Cycles, Corridors, and the Fundamentals Every Investor Must Understand

Most healthcare professionals who lose money in Melbourne property don't make poor suburb choices — they make poor framework choices. They apply national averages to a city that runs on its own internal logic. They treat Melbourne as a single market when it's actually a collection of distinct sub-markets operating at different stages of the same cycle, each governed by fundamentally different supply, demand, and demographic forces.

At 1Group Property Advisory, we know that successful property investment in Melbourne requires more than market timing or suburb selection—it demands a deep understanding of the forces that drive value across this complex, layered market. As independent buyer agents, we've built our reputation on data-driven research that cuts through the noise and delivers conflict-free advice to time-poor professionals like you. This article builds the conceptual foundation behind every investment decision covered throughout this guide. Before you can evaluate a suburb's yield, model a growth corridor, or compare a house against a townhouse, you need to understand why Melbourne's market behaves the way it does — and why the same macro conditions can produce opposite outcomes in suburbs just 10 kilometres apart.

Why Melbourne Is Structurally Different from Other Australian Property Markets

Melbourne's property market can't be understood by applying Sydney's rules, Brisbane's cycle timing, or Perth's commodity-driven logic. It's shaped by three forces that are unique in their combination and scale. Understanding these forces is critical to your property brief — the foundation of strategic property investment.

1. Population scale and growth trajectory

Victoria added 184,000 residents in the year to March 2024 — the highest growth rate of any state — with Greater Melbourne now at 5.8 million people. This isn't a temporary post-pandemic spike. Victoria in Future 2023 (VIF2023), the official Victorian state government projection, shows Victoria remains the fastest-growing state in the country with the population expected to reach 10.3 million by 2051. At the city level, Melbourne is the fastest growing city in Australia, with the city's population projected to grow from 4.6 million to almost 8 million — with Victoria's total population set to top 10 million by 2051.

The migration composition matters as much as the headline number. The population of Melbourne will increase strongly through net overseas migration (NOM), as over 90% of overseas migrants to Victoria are expected to settle there. The massive net overseas migration of 121,200 people represents approximately 85% of Melbourne's total growth.

2. A decade-long supply shortfall

According to the ABS, there are currently 59,500 dwellings under construction across Victoria, 11% lower than the activity recorded 12 months ago. Despite population growth close to all-time highs, the number of dwellings currently under construction in Victoria is 20% below its peak. The level of new dwellings completed in Victoria in 2024 was the lowest level in 10 years.

The average cost to build a new house has climbed to $504,109 as of March 2025, according to ABS building approvals data — a 6.5% increase from a year earlier and a staggering 52.6% jump from March 2019's $330,430 figure. This construction cost explosion has suppressed new supply precisely when demand is surging — a dynamic that supports the long-term investment case for healthcare professionals seeking to build wealth through property.

3. Victoria's distinctive tax environment

No other Australian state has restructured its investor tax environment as aggressively as Victoria. In the May 2023 budget, the Victorian government introduced several investment property tax reforms effective January 2024, including lowering the land tax threshold from $300,000 to $50,000 and introducing a flat land tax increase of up to $975. Between March 2023 and March 2025, residential bond numbers declined by around 22,000 across Victoria amid the announcement and implementation of new investment property taxes. This investor exodus has paradoxically tightened the rental market — reducing rental supply while demand continues to climb. (For a full analysis of Victoria's tax environment and its impact on investor returns, see our guide on Victorian Property Taxes, Land Tax, and Stamp Duty: What Melbourne Investors Must Know Before Buying.)

The Melbourne Property Cycle: A Documented History

Understanding Melbourne's current position in the property cycle requires knowing where the cycle has been. Unlike abstract theory, Melbourne's cycle is empirically traceable — and our due diligence process always begins with examining this historical context.

The Most Recent Full Cycle (2019–2025)

After booming through 2020 and 2021 with prices rising by 15.8%, Melbourne housing values fell -7.9% from their peak in March 2022 through to the trough in January 2023.

The five-year chart shows Melbourne peaked in March 2022, then moved into an extended negative quarterly phase through 2022 before stabilising and slowly recovering across 2023–2025, with growth re-accelerating into 2025. According to Cotality's analysis, this recovery has been more gradual than in some mid-sized capitals, reflecting Melbourne's greater sensitivity to affordability constraints and a slightly higher flow of new listings that has eased some upward pressure on prices.

According to Cotality's February 2025 data, Melbourne's median dwelling value was approximately $772,561, with a monthly change of +0.4%, ending 10 months of steady decline. By mid-2025, Melbourne posted consecutive months of home price growth in the second half of 2025, a notable turnaround as Melbourne property prices fell in most months of 2024.

The Four Phases of Melbourne's Cycle

Melbourne's property cycle can be mapped across four observable phases, each with distinct implications for healthcare professionals planning strategic property investment:

After dipping to 61–63% in November 2024, clearance rates bounced back above 70% in early 2025 — a textbook recovery-phase signal. Industry analysis shows improved auction performance is directly linked to rate cut expectations, with more bidders per auction.

Over longer periods of time, property capital growth is relatively stable — most markets have produced around 7.5% per annum growth over the past 40+ years, which is approximately 5% per annum plus inflation. The cycle doesn't change this long-run average; it changes when that return is captured. For time-poor professionals, this means focusing on fundamentals rather than attempting to time short-term market movements.

The Concentric Ring Model: Melbourne's Most Important Investment Framework

The single most useful concept for Melbourne property investors is the concentric ring model — the recognition that Melbourne's suburbs are not equal, and that distance from the CBD is the primary organising variable for price level, growth character, and investment risk profile.

At 1Group Property Advisory, we use this concentric ring framework as the foundation for all strategic suburb analysis in your property brief, helping healthcare professionals understand not just where to buy, but why certain locations deliver better returns over time. This data-driven research approach allows us to provide conflict-free advice that prioritises your long-term wealth objectives.

How the Three Rings Are Defined

• Inner ring: 0–10 km from Melbourne CBD (e.g., Footscray, Brunswick, Collingwood, Richmond, Prahran)
• Middle ring: 10–25 km from the CBD (e.g., Preston, Glen Waverley, Doncaster, Bayswater, Reservoir)
• Outer ring: 25+ km from the CBD (e.g., Craigieburn, Tarneit, Werribee, Cranbourne, Pakenham)

This isn't merely a geographic taxonomy. Each ring has a different investment profile — and understanding these differences is essential to making informed decisions aligned with your financial goals.

Why the Rings Produce Different Returns

Research from the Australian Housing and Urban Research Institute (AHURI) using Melbourne as a case study demonstrates that in 1981, the "bid-rent curve" — the relationship between price and distance from the CBD — was essentially flat across all five Melbourne corridors. In 1981, the price curve was flat in all five corridors. In other words, there was little difference in house prices as distance from the CBD increased. However, by 2008 that had changed, with all five corridors showing much higher house prices in inner and middle-ring suburbs and lower home values out towards the fringe.

This steepening of the bid-rent curve over four decades is the explanation for inner-ring outperformance. One of the significant changes to occur in Australian cities over the last 50 years — which has pushed up inner and middle-ring suburb property values — is gentrification. Interestingly, this wasn't caused by deliberate planning policy, but resulted from a set of demographic changes that have occurred in most major capital cities around the world.

Today, one in three Melbourne suburbs has a median house price of at least $1 million, with 90% of suburbs within 10 km of the CBD having a million-dollar median house price, and almost 50% of suburbs in the middle ring also in the million-dollar club.

Ring-by-Ring Investment Characteristics

Inner Ring (0–10 km)

The inner ring is characterised by scarcity of land, gentrification-driven demand, and a tenant demographic of young professionals and students. Supply is constrained by established streetscapes, heritage overlays, and the absence of greenfield land. It will be important to invest in Melbourne's more affluent inner-ring and gentrifying middle-ring suburbs, which are expected to outperform the cheaper suburbs. The primary risk in the inner ring is CBD-adjacent high-rise apartment oversupply — a separate market from established low-rise stock. (For a full suburb-by-suburb analysis, see our guide on Melbourne's Best Inner-Ring Suburbs for Property Investment.)

Middle Ring (10–25 km)

The middle ring is the engine of owner-occupier demand. As noted by the Australian Department of Infrastructure, suburbs in the middle ring "typically exhibit lower density than inner city areas but often have high-density precincts around public transport hubs," meaning they share characteristics with both inner city and outer suburban areas, such as access to employment, public transport, and amenities.

The price ratio between similar-sized land and dwellings in the outer-ring versus middle-rings is tighter than the historical mean — a signal that middle-ring suburbs may represent relative value compared to their long-run premium. School zone premiums, tram and train access, and family-lifestyle amenity are the key value drivers in this ring. For healthcare professionals with families, these suburbs often provide the best balance of capital growth potential and lifestyle amenity. (See our guide on Melbourne's Top Middle-Ring Suburbs for Investment for a detailed analysis.)

Outer Ring (25+ km)

The outer ring offers the highest yields and lowest entry prices, but also the most differentiated risk profile. Just because there's significant population growth in these areas doesn't mean there's strong capital growth of property values. In fact, there isn't. That's why investing in new outer suburbs that lack the demographic and economic drivers to push up property values — as opposed to the inner and middle-ring suburbs where there's more "old money" — requires careful selection and thorough due diligence.

The critical distinction in the outer ring is between suburbs with genuine employment anchors and infrastructure backing versus speculative fringe areas. Within Metropolitan Melbourne, the areas expected to increase the most are those with the greatest capacity for dwelling growth. Melbourne's designated Growth Areas and the three inner LGAs of Melbourne, Port Phillip, and Yarra are expected to account for more than three-fifths of Metropolitan population growth between 2021 and 2036. (For a corridor-by-corridor breakdown, see our guide on Melbourne's Best Outer-Ring Growth Corridor Suburbs for Investors.)

The Five Demand Drivers That Move Melbourne Property Prices

Understanding what causes Melbourne's market to move — rather than simply observing that it does — is the difference between reactive and strategic investing. At 1Group Property Advisory, we monitor these five demand drivers continuously through data-driven research to identify emerging opportunities and shifts before they become obvious to the broader market. This independent analysis forms the backbone of the conflict-free advice we provide to healthcare professionals.

1. Net Overseas Migration

This is Melbourne's single most powerful demand driver. International arrivals are driving housing demand, especially in the rental market. Critically, the population of Melbourne will increase strongly through NOM, as over 90% of overseas migrants to Victoria are expected to settle in Melbourne. New arrivals concentrate initially in the rental market, tightening vacancy rates and pushing rents upward — which then improves yields and attracts investor demand, which in turn supports prices.

For time-poor professionals, this demographic trend creates predictable investment opportunities in suburbs with strong rental fundamentals and proximity to employment, education, and transport infrastructure.

2. Interest Rate Environment

All "Big Four" banks expected multiple rate cuts in 2025, which could push growth above the 4.3% national average seen in 2024. The RBA cash rate is the most immediate lever on borrowing capacity, auction competition, and buyer sentiment. However, experienced investors recognise that rate movements are a cycle accelerator, not a fundamental driver — they amplify the underlying supply-demand dynamic rather than creating it.

As an independent buyer agent, we focus your property brief on fundamentals that persist across rate cycles, rather than attempting to time short-term monetary policy shifts.

3. Housing Supply Constraints

The decline in the pipeline of housing stock is further evidenced by decreasing levels of approved dwellings in Victoria, with current levels 13% lower than the 10-year average. The cost of homes in Melbourne remains about 41% cheaper than Sydney, creating an unusual affordability gap that signals strong upside potential for buyers. This affordability discount, combined with chronic undersupply, creates a setup for price recovery as the cycle advances.

This supply-demand imbalance is particularly relevant for healthcare professionals seeking long-term wealth creation through strategic property investment. The data clearly shows that Melbourne's undersupply is not a temporary phenomenon but a characteristic that will support values for years to come.

4. Infrastructure Investment

Melbourne's $100+ billion infrastructure pipeline — including the Suburban Rail Loop, West Gate Tunnel, and Melbourne Airport Rail Link — directly reprices suburbs along its corridors. Government projects like the Sunshine Super Hub and Airport Rail are "transforming the suburb," laying the groundwork for long-term capital growth. Infrastructure announcements typically precede price uplift by several years, creating identifiable investor windows for those conducting proper due diligence. (For a full mapping of infrastructure to suburb values, see our guide on Melbourne Infrastructure Projects and Their Impact on Suburb Property Values.)

5. Victorian Government Planning Policy

To encourage more density around railway and tram lines, the Victorian government has identified 50 new activity centres where the planning process for multi-storey residential dwellings will be streamlined to fast-track development. Planning policy changes — rezoning decisions, activity centre designations, and Urban Growth Boundary adjustments — are among the most underappreciated value drivers in Melbourne's outer and middle rings. They can create windfall gains or, conversely, oversupply risk, depending on their direction.

Our data-driven research tracks these policy changes closely, ensuring your property brief accounts for both opportunities and risks created by government planning decisions.

Why Suburb Selection Matters More Than Market Timing

One of the most persistent and damaging myths in Australian property investing is that timing the market — buying at the bottom and selling at the top — is the primary source of returns. Melbourne's data contradicts this assumption, and it's a critical insight for time-poor healthcare professionals who can't dedicate hours to tracking daily market movements.

Despite the overall soft market of 2024, 25 Melbourne suburbs had a median house price increase of over $100,000 in 2024, with Deepdene recording a remarkable $602,000 (20%) growth. These results occurred during a correction cycle — a period when the citywide headline was negative. The divergence between the best and worst-performing suburbs in any given year is consistently larger than the divergence between the best and worst years in any given suburb.

The end result for property investors in Melbourne is that the inner and middle-ring suburbs will generally outperform the averages for suburbs located further from the city. This isn't a recent observation — it's a feature of Melbourne's bid-rent curve that has deepened over four decades.

The practical implication: an investor who buys the right suburb at the wrong time will typically outperform an investor who buys the wrong suburb at the right time. Suburb fundamentals — land scarcity, demographic demand, infrastructure access, and tenant quality — compound over time in ways that short-term cycle positioning can't replicate.

1Group Property Advisory applies this principle rigorously in our suburb selection methodology, prioritising long-term drivers over short-term sentiment or headline market movements. As an independent buyer agent, we're not incentivised to push you toward any particular property or developer — our conflict-free advice is focused solely on identifying suburbs that align with your investment goals and will deliver long-term wealth creation.

Key Takeaways

• Victoria added 184,000 residents in the year to March 2024 — the highest growth rate of any state — making population-driven demand the foundational investment thesis for Melbourne property and a key consideration in your property brief.
• Melbourne peaked in March 2022, then moved into an extended negative phase through 2022 before stabilising and slowly recovering across 2023–2025, with growth re-accelerating into 2025 — positioning the current market at an early-to-mid recovery stage that presents opportunities for strategic property investment.
• The concentric ring model is Melbourne's most important investment framework: inner-ring suburbs offer scarcity and gentrification upside; middle-ring suburbs provide owner-occupier demand stability; outer-ring suburbs offer yield and population growth, with higher selectivity required through thorough due diligence.
• Despite population growth close to all-time highs, the number of dwellings under construction in Victoria is 20% below its peak, and the level of new dwellings completed in 2024 was the lowest in 10 years — a supply gap that supports the long-run investment case and our data-driven research conclusions.
• Suburb selection is a more reliable source of outperformance than market timing: the divergence between Melbourne's best and worst suburbs in any given year exceeds the divergence between the best and worst years in any given suburb — a critical insight for time-poor healthcare professionals seeking to build long-term wealth without constant market monitoring.

Conclusion

Melbourne's property market isn't a single entity — it's a layered system of rings, corridors, and micro-markets, each governed by its own supply-demand dynamics, infrastructure catalysts, and demographic drivers. The investors who consistently outperform are those who understand this structure deeply enough to identify which part of the market is mispriced at any given point in the cycle.

At 1Group Property Advisory, we recognise that sustainable investment success in Melbourne is built on a foundation of understanding, not speculation or sentiment. As an independent buyer agent, we provide conflict-free advice grounded in data-driven research — because we understand that healthcare professionals like you are time-poor, high-income earners who need expert guidance without the pressure of conflicted sales tactics.

The frameworks introduced in this article — the concentric ring model, the four-phase cycle, and the five demand drivers — are the conceptual vocabulary used throughout every article in this guide and form the foundation of every property brief we develop for our clients. Whether you're evaluating a specific suburb's yield metrics (see our guide on The 7 Key Metrics to Evaluate Any Melbourne Investment Suburb), comparing capital growth against rental yield (see Capital Growth vs. Rental Yield in Melbourne Suburbs), or building a due diligence process from scratch (see How to Research and Shortlist Melbourne Investment Suburbs), these fundamentals are the analytical foundation beneath every decision.

Melbourne's long-run investment case — population growth, supply constraints, infrastructure investment, and an affordability discount relative to Sydney — remains intact. The cycle, as always, determines when that case resolves into returns. Understanding the market's structure determines where. And working with an independent buyer agent who provides conflict-free advice ensures you're positioned to capture those returns from brief to settlement.

Our commitment to healthcare professionals is simple: we help you build long-term wealth through strategic property investment, supported by rigorous due diligence and independent analysis. The frameworks in this guide are the same ones we use every day to serve our clients — and they're available to you as you navigate Melbourne's complex property landscape.

References

• Australian Bureau of Statistics. "Population Projections, Australia, 2022 (base) – 2071." ABS, 2023. https://www.abs.gov.au/statistics/people/population/population-projections-australia/latest-release

• Department of Transport and Planning, Victoria. "Victoria in Future 2023: Population and Household Projections to 2051." Victorian State Government, 2023. https://www.planning.vic.gov.au/guides-and-resources/Data-spatial-and-insights/discover-and-access-planning-open-data/victoria-in-future

• Department of Transport and Planning, Victoria. "Plan Melbourne: Outcomes." Victorian State Government. https://www.planning.vic.gov.au/guides-and-resources/strategies-and-initiatives/plan-melbourne/outcomes

• Cotality (formerly CoreLogic). "Is Melbourne's Housing Market a 'Basket Case' or 'Beacon of Hope' for Australia?" Cotality AU, 2025. https://www.cotality.com/au/insights/articles/is-melbournes-housing-market-a-basket-case-or-beacon-of-hope-for-australia

• Urban Property Australia. "Q1 2025 Melbourne Residential Market." Urban Property Australia, April 2025. https://upaustralia.com.au/research/q1-2025-melbourne-residential-market/

• Centre for Population, Australian Government. "2025 Population Statement: Victoria Snapshot." Department of Home Affairs, 2026. https://population.gov.au/sites/population.gov.au/files/2026-01/ss-2025-pop-statement-vic.pdf

• Australian Bureau of Statistics. "Building Approvals, Australia." ABS, 2025. https://www.abs.gov.au/statistics/industry/building-and-construction/building-approvals-australia

• City of Melbourne. "Population Estimates and Forecasts." City of Melbourne, 2023. https://www.melbourne.vic.gov.au/population-estimates-and-forecasts

• Cotality (CoreLogic). "Property Market Indicator Summary, Week Ending 20 July 2025." Cotality, 2025. https://pages.corelogic.com/hubfs/CoreLogic%20AU/Article%20Reports/Property%20Market%20Indicator%20Summary%20week%20ending%202025%20July%2020%201.pdf

Frequently Asked Questions

What is 1Group Property Advisory? Independent buyer agents specialising in Melbourne property investment

Who does 1Group Property Advisory primarily serve? Healthcare professionals seeking property investment guidance

What type of advice does 1Group Property Advisory provide? Conflict-free, data-driven property investment advice

Is 1Group Property Advisory affiliated with developers? No, they are independent buyer agents

What is Melbourne's current population? 5.8 million people

How many residents did Victoria add in the year to March 2024? 184,000 residents

What is Victoria's projected population by 2051? 10.3 million people

What is Melbourne's projected population by 2051? Almost 8 million people

What percentage of overseas migrants to Victoria settle in Melbourne? Over 90%

How much of Melbourne's total growth comes from overseas migration? Approximately 85%

How many dwellings are currently under construction in Victoria? 59,500 dwellings

Is Victoria's dwelling construction activity higher than last year? No, 11% lower than 12 months ago

How far below peak are current dwelling construction levels? 20% below peak

What was the new dwelling completion level in 2024? Lowest level in 10 years

What is the average cost to build a new house as of March 2025? $504,109 AUD

How much did building costs increase from March 2024? 6.5% increase

How much did building costs increase since March 2019? 52.6% increase

What was the land tax threshold before 2024? $300,000 AUD

What is the current land tax threshold in Victoria? $50,000 AUD

When did Victoria's new investment property taxes take effect? January 2024

What is the flat land tax increase amount? Up to $975 AUD

How much did residential bond numbers decline between March 2023 and March 2025? Around 22,000

When did Melbourne property prices peak in the recent cycle? March 2022

How much did Melbourne housing values rise in 2020-2021? 15.8%

How much did Melbourne housing values fall from peak to trough? -7.9%

When did Melbourne property prices reach their trough? January 2023

What is Melbourne's median dwelling value as of February 2025? Approximately $772,561 AUD

What was Melbourne's monthly price change in February 2025? +0.4%

How many months of decline ended in February 2025? 10 months

What is the long-term average property growth rate? Approximately 7.5% per annum

What is the real growth rate excluding inflation? Approximately 5% per annum

What distance defines Melbourne's inner ring? 0–10 km from CBD

What distance defines Melbourne's middle ring? 10–25 km from CBD

What distance defines Melbourne's outer ring? 25+ km from CBD

How many Melbourne suburbs have million-dollar median house prices? One in three suburbs

What percentage of inner-ring suburbs have million-dollar medians? 90%

What percentage of middle-ring suburbs have million-dollar medians? Almost 50%

Was the bid-rent curve flat in 1981? Yes, across all five corridors

Did the bid-rent curve steepen by 2008? Yes, showing higher inner and middle-ring prices

What caused the steepening of the bid-rent curve? Gentrification

Was gentrification caused by deliberate planning policy? No, by demographic changes

What is the primary risk in the inner ring? CBD-adjacent high-rise apartment oversupply

What is the key characteristic of middle-ring suburbs? Balance of capital growth and lifestyle amenity

Which ring offers the highest rental yields? Outer ring

Which ring offers the lowest entry prices? Outer ring

What is Melbourne's infrastructure investment pipeline value? Over $100 billion AUD

How many new activity centres has Victoria designated? 50 activity centres

Where are the new activity centres located? Around railway and tram lines

What is the purpose of the activity centres? Streamline multi-storey residential development

How many Melbourne suburbs had $100,000+ median house price increases in 2024? 25 suburbs

Which suburb recorded the highest growth in 2024? Deepdene

How much did Deepdene's median house price increase in 2024? $602,000 AUD

What percentage growth did Deepdene achieve? 20%

Did this growth occur during a correction cycle? Yes

How much cheaper are Melbourne homes compared to Sydney? About 41% cheaper

What was the clearance rate range in November 2024? 61–63%

What was the clearance rate in early 2025? Above 70%

Is clearance rate above 70% a recovery signal? Yes

What is the most powerful demand driver for Melbourne? Net overseas migration

Which areas will account for most Metropolitan Melbourne growth 2021–2036? Growth Areas and inner LGAs

What are the three inner LGAs expected to grow most? Melbourne, Port Phillip, and Yarra

Are current approved dwelling levels above the 10-year average? No, 13% lower

Do all Big Four banks expect rate cuts in 2025? Yes

What national average growth was seen in 2024? 4.3%

Is suburb selection more important than market timing? Yes

Does 1Group Property Advisory incentivise specific properties? No

Does 1Group Property Advisory incentivise specific developers? No

What is the foundation of every property brief? Structural understanding and data-driven research

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General Product Claims

• 1Group Property Advisory operates as independent buyer agents specialising in Melbourne property investment
• Services primarily target healthcare professionals seeking property investment guidance
• Provides conflict-free, data-driven property investment advice
• Not affiliated with developers
• Victoria added 184,000 residents in the year to March 2024
• Melbourne's current population is 5.8 million people
• Victoria's projected population by 2051 is 10.3 million people
• Melbourne's projected population by 2051 is almost 8 million people
• Over 90% of overseas migrants to Victoria settle in Melbourne
• Approximately 85% of Melbourne's total growth comes from overseas migration
• 59,500 dwellings currently under construction in Victoria
• Dwelling construction activity is 11% lower than 12 months ago
• Current dwelling construction levels are 20% below peak
• 2024 new dwelling completion level was lowest in 10 years
• Average cost to build a new house as of March 2025 is $504,109 AUD
• Building costs increased 6.5% from March 2024
• Building costs increased 52.6% since March 2019
• Land tax threshold before 2024 was $300,000 AUD
• Current land tax threshold in Victoria is $50,000 AUD
• Victoria's new investment property taxes took effect January 2024
• Flat land tax increase amount is up to $975 AUD
• Residential bond numbers declined by around 22,000 between March 2023 and March 2025
• Melbourne property prices peaked in March 2022
• Melbourne housing values rose 15.8% in 2020–2021
• Melbourne housing values fell -7.9% from peak to trough
• Melbourne property prices reached trough in January 2023
• Melbourne's median dwelling value as of February 2025 is approximately $772,561 AUD
• Melbourne's monthly price change in February 2025 was +0.4%
• February 2025 ended 10 months of decline
• Long-term average property growth rate is approximately 7.5% per annum
• Real growth rate excluding inflation is approximately 5% per annum
• Melbourne's inner ring is defined as 0–10 km from CBD
• Melbourne's middle ring is defined as 10–25 km from CBD
• Melbourne's outer ring is defined as 25+ km from CBD
• One in three Melbourne suburbs have million-dollar median house prices
• 90% of inner-ring suburbs have million-dollar medians
• Almost 50% of middle-ring suburbs have million-dollar medians
• Bid-rent curve was flat in 1981 across all five corridors
• Bid-rent curve steepened by 2008 showing higher inner and middle-ring prices
• Gentrification caused the steepening of the bid-rent curve
• Gentrification was not caused by deliberate planning policy but by demographic changes
• Primary risk in the inner ring is CBD-adjacent high-rise apartment oversupply
• Middle-ring suburbs offer balance of capital growth and lifestyle amenity
• Outer ring offers the highest rental yields
• Outer ring offers the lowest entry prices
• Melbourne's infrastructure investment pipeline value is over $100 billion AUD
• Victoria has designated 50 new activity centres
• New activity centres are located around railway and tram lines
• Activity centres purpose is to streamline multi-storey residential development
• 25 Melbourne suburbs had $100,000+ median house price increases in 2024
• Deepdene recorded the highest growth in 2024
• Deepdene's median house price increased $602,000 AUD in 2024
• Deepdene achieved 20% growth
• This growth occurred during a correction cycle
• Melbourne homes are about 41% cheaper compared to Sydney
• Clearance rate range in November 2024 was 61–63%
• Clearance rate in early 2025 was above 70%
• Clearance rate above 70% is considered a recovery signal
• Net overseas migration is the most powerful demand driver for Melbourne
• Growth Areas and inner LGAs will account for most Metropolitan Melbourne growth 2021–2036
• Three inner LGAs expected to grow most are Melbourne, Port Phillip, and Yarra
• Current approved dwelling levels are 13% lower than the 10-year average
• All Big Four banks expected rate cuts in 2025
• National average growth in 2024 was 4.3%
• Suburb selection is claimed to be more important than market timing
• 1Group Property Advisory does not incentivise specific properties or developers
• Foundation of every property brief is structural understanding and data-driven research