While the national property market recovered in a big way through 2023, that of Melbourne dragged its feet.

Melbourne’s median house price currently sits at around $1,050,000, according to Domain, while its median unit price is close to $570,000. 

Those figures are respectively 4.1% and 5.5% lower than their previous price peak, but are expected to grow in the new year.

Melbourne house values are tipped to rise between 2% and 3% in 2024 and those of the city’s units are forecast to climb 3% to 4%. 

While notable, such forecasts are a long way off the 7% to 9% of growth Domain predicts for Sydney houses next year.

 “It's really interesting that comparison between the Sydney and Melbourne market,” Domain chief of research and economists Nicola Powell told the Savings Tip Jar Podcast. 

“What you tend to find is that Melbourne leads price cycles and Sydney follows, and that's not what we've seen over the last 12 months.

“One of the main reasons for the difference in performance is supply level. 

“If I was going to pick out any city where supply levels are much better, that is Melbourne. I think partly because of the ability for Melbourne to sprawl, it's been much better at providing dwellings.”

So, the Melbourne market might lag those of its capital city peers once more in 2024.

But that doesn’t mean it isn’t home to plentiful opportunities.

Savings.com.au reached out to experts to find the suburbs that could be set to grow in 2024.

Median price data sourced via Realestate.com.au and is accurate as at December 2023.


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Westmeadows, 3049

Westmeadows, located around 16 kilometres north-west of the CBD, provides an escape from the busy city lifestyle.

“Those who live in Westmeadows say that it is a great location as it's very close to the Melbourne CBD but there is a ‘living in the country’ feel,” PRD chief economist Diaswati Mardiasmo said. 

“A great location with a shopping village, bus stop, restaurants, and pub nearby; considered to be very safe.

“A lot of homes are now being renovated as more and more families realise how underrated this area is.

"Apparently it's a ‘best kept secret’!”

  • Median price: $700,000 for houses, $529,250 for units
  • Median weekly rent: $450 a week for houses, $440 a week for units

Epping, 3076

Further north is the quiet suburb of Epping – another spot to watch in 2024.

“Epping has a reputation for being the perfect place for retirees who want to find a place with lots of natural beauty, affordable goods, and a slower pace of life,” Dr Mardiasmo said.

“It does have an affordable price for units, so it could be a nice place for a first home buyer to start with.”

Epping was crowned Melbourne's most affordable and liveable suburb, as per the two most recent editions of PRD’s bi-annual Affordable & Liveable Property Guide.

The guide considers important factors such as a suburb's median property price, investment potential, future planned development, crime rate, and access to amenities to find some of Australia's most affordable and liveable areas.

  • Median price: $666,000 for houses, $425,000 for units
  • Median weekly rent: $450 for houses, $380 for units

Inner city: Windsor, Prahran, Richmond, Fitzroy, St Kilda, Port Melbourne, etc

The market for inner city cottages is also well worth considering, according to WHITEFOX founder and CEO, and judge on the most recent season of The Block, Marty Fox.

Specially, two-bed Victorian-type cottages,  around the price point of $1 million to $1.5 million, in suburbs such as Windsor, Prahran, Richmond, Fitzroy, St Kilda and Port Melbourne could be worth keeping an eye on.

“Investors are lapping up the lack of competition from first time homeowners who are struggling at getting finance on these properties yet the returns are still strong,” Marty Fox told Savings.com.au.

“These are still getting strong rental applicants, yet the entry level homes have a lack of competitive bidding.

“Homes that were selling for $1.4 million or so are now trading around the low-$1 million mark.”

Fawkner, 3060

If you’re in the market for a family-friendly lifestyle at an affordable price in an area that allows easy access to your city-centric work pursuits, Fawkner could be the place for you.

“Fawkner is located about 12 kilometres from the Melbourne CBD, so quite close for those who need to commute,” Dr Mardiasmo noted. 

“It has also earned the title of ‘Fabulous Family Friendly Fawkner’, apparently another best kept secret when it comes to affordable, family-friendly, accessible, and safe suburbs.”

The area also tends to offer larger blocks and houses than other suburbs.

  • Median price: $758,500 for houses, $525,000 for units
  • Median weekly rent: $480 for houses, $450 for units 

Mornington Peninsula

Looking slightly beyond the City of Melbourne could also prove worthwhile, with Mr Fox suggesting hopeful buyers consider the picturesque Shire of Mornington Peninsula. 

“The Mornington Peninsula has had significant price drops since interest rates have gone up and as people have felt the pinch of inflation,” he said.

“If you have the spare cash, expect to pick up certain properties for as much as 30% less than you might have paid at the peak of 2021-22.”

Hot tip: Development sites 

It’s not just houses and units in Melbourne that could provide a notable opportunity for astute buyers.

“Development sites are going for the best rates they have in a long time due to the cost of construction,” Mr Fox said.

The best opportunities for unbroken ground are likely in the suburbs, no further than 15 kilometres to 20 kilometres from the CBD, and close to local amenities.

Circa-$1.6 million to $1.8 million is likely “the sweet spot”, according to Mr Fox.

Image by Denise Jans on Unsplash.

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