Melbourne has quietly become Australia’s most affordable capital city, and the investors are starting to notice.
A new analysis from property advisory firm Oliver Hume has revealed just how dramatically Melbourne’s position in the national housing market has shifted. Five years ago, it was the most expensive or second most expensive city in the country. Today, according to Oliver Hume chief executive, Julian Coppini, it’s the cheapest.
That reversal, driven by several years of subdued price growth while other capitals like Perth, Brisbane, and Adelaide surged ahead, has created what many in the industry are calling a genuine value window, and it’s attracting a wave of interstate attention that hasn’t been seen in years.
A Market at a Turning Point
Oliver Hume’s chief economist, Matt Bell, noted that Melbourne had been sitting at 15-year lows for transaction volumes before signs of recovery started to emerge. Despite the prolonged downturn, the underlying fundamentals have continued to strengthen:
- Pent-up demand is elevated
- Population growth has resumed
- Relative affordability is at levels not seen in decades
The firm is forecasting a roughly 20 per cent lift in transaction volumes over the next year as buyers and investors respond to the pricing gap between Melbourne and every other major capital.
PIPA chair and buyer’s agent, Cate Bakos, confirmed the shift is real, noting that interstate enquiries over the past year have been the strongest she’s seen in several years. Importantly, the interest is concentrated in the lower and middle parts of the market — detached houses in growth areas where the entry price still stacks up and the long-term fundamentals are solid.
Why Melbourne’s Western Growth Corridor Is Drawing Attention
For investors and first-home buyers looking at where this value story plays out on the ground, Melbourne’s western suburbs are hard to overlook.
Tarneit, in particular, has emerged as one of Melbourne’s most connected and well-serviced growth suburbs:
- Established rail, retail, and education infrastructure
- New West Tarneit Station under construction, improving CBD access
With land prices in Melbourne’s west starting well below the city’s median, and Oliver Hume data showing Melbourne’s gross median lot price at around $407,000 — significantly behind South East Queensland at $483,600 — the entry point for buyers in suburbs like Tarneit sits at a level that’s increasingly difficult to find in other Australian capitals.
It’s the kind of positioning that tends to attract attention in the early stages of a market recovery, and that’s exactly where Melbourne appears to be right now.
Early Stages of the Next Cycle
Cate Bakos described the current conditions as the early stages of Melbourne’s next property cycle, while noting that the market remains segmented, with some areas and price brackets recovering faster than others.
REIA president, Jacob Caine, acknowledged that Victoria’s regulatory and tax settings have made some local investors cautious, but said interstate buyers are increasingly viewing the state as a value opportunity. Melbourne’s core strengths remain firmly in place:
- Amenity and liveability
- Transport infrastructure
- Rental demand
For those watching the market closely, the combination of flat pricing, rising demand, and structural undersupply in Melbourne’s growth corridors points to a window that may not stay open indefinitely.
Unity Park: Tarneit’s Home Ground
For buyers looking to act on the opportunity in Melbourne’s west, Unity Park in Tarneit is now selling, with land from $307,500 and $20,000 off selected titled lots.
Developed by HB Land, Unity Park is an established and growing community with Barayip Primary School and Aspire Childcare centre open, and the new West Tarneit Station under construction nearby. Every home is within walking distance of the community park, the local school, and everyday amenities, like the Riverdale shopping centre.
In a market where value, connectivity, and long-term growth potential are driving buyer decisions, Unity Park delivers on all three.
Explore land for sale or enquire today to find out what’s available.