10 best suburbs to invest in Melbourne in 2024
Melbourne is the big improver in the national real estate scene. Its national ranking has jumped from 13th in the 2023 edition of Rising Stars to equal fifth (alongside Regional Queensland) in this report. Very little separates the top five in this analysis: Melbourne rates only marginally behind Brisbane, Sydney, Adelaide and Perth in our assessment of prospects for 2024.
20 Mar 2024
Melbourne is the big improver in the national real estate scene. Its national ranking has jumped from 13th in the 2023 edition of Rising Stars to equal fifth (alongside Regional Queensland) in this report. Very little separates the top five in this analysis: Melbourne rates only marginally behind Brisbane, Sydney, Adelaide and Perth in our assessment of prospects for 2024.
The transformation of the Melbourne market in the second half of 2023 was one of the year’s big real estate stories. It was a struggling market, with sales activity weak and prices falling, but then market activity improved dramatically as the year evolved. In 2024, It has not yet translated into major price rises, so there is potential for good growth this year.
One of the core factors in the Melbourne revival, has been the improvement in the Victorian economy, as ranked by CommSec, as the nation’s strongest in the October 2023 edition of the State of the States report. Another factor is the return of overseas migration (particularly international students) following the end of the period of lockdowns and border closures. Tenants and buyers from overseas typically have an impact on the Melbourne property market, and that is now returning.
Top 10 Rising Stars
- Ascot Vale
- Boronia
- Brunswick East
- Collingwood
- Frankston
- Mill Park
- Mitcham
- Northcote
- Nunawading
- Oakleigh
Ascot Vale
Homes are selling quickly in this suburb just 6 km north-west of the MelbourneCBD, with a median house price now above $1.3 million and apartments becoming popular around $600,000. The suburb is connected via both trains and trams, as well as Citylink. It is also a neighbour of Parkville with its hospitals and university campuses. Vacancies are below the Melbourne average at 1%.
Boronia
The key statistics show how popular this eastern suburb of Melbourne is becoming, with 226 house sales and 205 apartment sales in the past 12 months. Homes typically sell inside three weeks and the vacancy rate below average for Melbourne at 0.7%. Its commercial-retail hub has two shopping centres and a train station linking it to central Melbourne. There are numerous schools in the suburb, including four primary schools.
Brunswick East
The three Brunswick suburbs (North, East and West) attract plenty of demand with their proximity to hospitals, universities, Melbourne Zoo and the Melbourne CBD. The median house price for Brunswick East is $1.3 million, but apartments are in the $500,000s and outnumber house sales three to one. Both dwelling types typically sell within three to four weeks and the vacancy rate is below average for Melbourne at 0.7%.
Collingwood
The rise of inner-city Melbourne markets includes the City of Yarra, with one of its suburbs, Collingwood, attracting increasing demand for its relative affordability, connectivity and proximity to the Melbourne CBD. Both houses and apartments generally sell within three weeks, and apartment sales outnumber houses four to one. The low vacancy rate of 0.6% provides further evidence of the suburb’s popularity. Local features include a TAFE campus and major green spaces along the Yarra River.
Frankston
The bayside suburb of Frankston, in the far south of Greater Melbourne, has grown in popularity for its affordability, infrastructure and good transport links. In the past 12 months, over 800 houses and units have been purchased, with median prices of $720,000 and $485,000, respectively. Homes generally sell in three to four weeks, and the vacancy rate is just 0.8%. Schools, universities, hospitals and golf courses are part of the Frankston offering.
Mill Park
The Whittlesea Local Government Authority (LGA) is one of Greater Melbourne’s growth areas, with new suburbs being added as the city spreads north. Mill Park is one of the longer established suburbs and recorded over 320 dwelling sales in the past 12 months. The 0.5% vacancy rate is one of the lowest in Greater Melbourne. The suburb includes the Westfield Plenty Valley complex and has two neighbours with major facilities – Epping and Bundoora.
Mitcham
The City of Whitehorse is consistently one of the leading markets in Middle Melbourne, and Mitcham is one of several popular residential suburbs. Buyer demand is rising, with over 250 dwelling sales in the past year. Homes typically sell in three to four weeks and vacancies are low at 0.7%. Mitcham is a place of many parks and schools, with quick access to the M3 Eastern Freeway.
Northcote
This inner northern suburb has grown in popularity for its local character and proximity to central Melbourne, with 375 dwelling sales in the past year and vacancies ultra low at 0.5%. The house median is above $1.6 million, and apartments provide a significantly cheaper alternative in the $600,000s. Shopping centres Northcote Plaza and Northcote Central sit alongside All Nations Park.
Nunawading
This is a suburb for families seeking relatively affordable homes and schools; as well as major large item retail stores. It also boasts rail links to inner Melbourne. It’s also ethnically diverse, with 40% of residents born outside Australia. Buyer demand has increased in recent times and homes typically sell in three to four weeks, with a vacancy rate under 1%.
Oakleigh
The City of Monash is one of the economic strongholds of Greater Melbourne, with Monash University, Monash Medical Centre and the Victorian Heart Hospital, among other facilities. Oakleigh is one of the LGA’s sought-after residential suburbs, with major road and rail links to central Melbourne.This area also has multiple golf courses. The median house price is above $1.3 million and apartments (in the $500,000s) are becoming increasingly popular.
Our Metrics
Sales volumes
The Melbourne market has come a long way in the past 12 months, and it ranks second in the nation on sales volume trends with sales activity, slightly behind Sydney. Almost half of suburbs across Greater Melbourne have rising markets based on patterns with sales volumes, which bodes well for price growth in the near future.
Quarterly price growth
Melbourne is behind in the growth cycle compared to other capital cities including Sydney and Brisbane, so its relatively recent revival in buyer activity has not yet translated into price growth to the same degree. Melbourne’s median house price rose 4% in the 2023 CoreLogic figures, compared with double-digit rises in Brisbane, Perth and Sydney. Only 36% of suburbs recorded quarterly rises above 2% in our analysis. This ranks Melbourne 11th on this metric – the only one where Melbourne fails to make the top four.
Vacancy rates
In the 2023 edition of Rising Stars, Melbourne ranked 13th (second last) on the vacancy rates metric. Now, in 2024, we rate it fourth in the nation. 70% of suburbs have vacancy rates below 1%, with the revival of overseas migration and international students now being fully felt.
Rental growth
Melbourne has one of the nation’s strongest economies and vacancy rates are tight in most suburbs, providing the conditions for rents to rise. Nine out of ten suburbs have recorded annual rent increases above 10%, which only is marginally behind Sydney, Brisbane and Perth on this metric.
Infrastructure spending
A key reason why the Melbourne economy is pumping is that there are so many big infrastructure projects happening.There are four transport developments under way, with each of them costing at least $10 billion. There are also numerous other multi-billion dollar education, medical, commercial and industrial projects under way or planned. We rank Melbourne fourth in the nation on this metric.
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| Suburb | Median price | 1-yr growth | 10-yr average annual growth (%pa) |
Vacancy rate | Median rental yield |
Initial Outlay (no concessions) on 20% deposit |
Monthly repayments |
|---|---|---|---|---|---|---|---|
| Ascot Vale | $1,325,000 | 0.4% | 2.6% | 1.0% | 2.6% | $341,190 | $6,700 |
| Ascot Vale (Unit) |
$595,000 | 2.8% | 3.5% | 1.0% | 4.5% | $151, 377 | $3,009 |
| Boronia | $840,000 | -0.6% | 3.1% | 0.7% | 3.3% | $215,651 | $4,247 |
| Boronia (Unit) |
$645,000 | -0.7% | 2.6% | 0.7% | 4.0% | $164,494 | $3,261 |
| Brunswick East | $1,300,000 | -3.6% | 4.7% | 0.7% | 2.8% | $334,757 | $6,574 |
| Brunswick East (Unit) |
$565,000 | -5.4% | 2.1% | 0.7% | 4.8% | $161,871 | $2,857 |
| Collingwood | $1,240,000 | -7.2% | 3.1% | 0.6% | 2.8% | $319,317 | $6,270 |
| Collingwood (Unit) |
$635,000 | -8.7% | 1.5% | 0.6% | 1.2% | $161,871 | $3,211 |
| Frankston | $720,000 | -7.7% | 3.6% | 0.8% | 3.7% | $184,170 | $3,641 |
| Frankston (Unit) |
$485,000 | -12.1% | 2.2% | 0.8% | 4.5% | $119,420 | $2,452 |
| Mill Park | $765,000 | -1.9% | 3.2% | 0.5% | 3.2% | $195,975 | $3,868 |
| Mill Park (Unit) |
$490,000 | -3.5% | 1.1% | 0.5% | 4.6% | $120,732 | $2,478 |
| Mitcham | $1,200,000 | 0.8% | 3.9% | 0.7% | 2.5% | $309,023 | $6,068 |
| Mitcham (Unit) |
$810,000 | -1.1% | 5.0% | 0.7% | 3.6% | $207,780 | $4,096 |
| Northcote | $1,665,000 | -2.1% | 4.6% | 0.5% | 2.6% | $428,301 | $8,419 |
| Northcote (Unit) |
$625,000 | -3.3% | 3.7% | 0.5% | 4.3% | $159,247 | $3,160 |
| Nunawading | $1,190,000 | 0.8% | 3.7% | 0.8% | 2.5% | $306,450 | $6,017 |
| Nunawading (Unit) |
$825,000 | -0.5% | 6.2% | 0.8% | 3.5% | $211,715 | $4,172 |
| Oakleigh | $1,350,000 | -6.5% | 3.0% | 1.2% | 2.5% | $347,624 | $6,826 |
| Oakleigh (Unit) |
$545,000 | -9.4% | -0.7% | 1.2% | 4.3% | $135,160 | $2,756 |
Source: www.canstar.com.au. Prepared on 22/01/2024. Based on a selection of suburbs’ median prices, growth and rent figures provided by Hotspotting by Ryder. Initial outlay figures include the deposit, stamp duty, mortgage registration and transfer fees; and lenders’ mortgage insurance (LMI) premium for the 10% deposit scenarios. Stamp duty calculated based on an owner occupier purchase of an established dwelling. LMI premium based on Helia LMI Premium Calculator for an owner occupier borrower and a loan term of 30 years. Monthly repayments calculated based on the average variable interest rates of 6.5% (20% deposit) and 6.8% (10% deposit) and a loan term of 30 years. Interest rates based on the average owner occupier, principal and interest variable rate for a loan of $600,000 over the past year, rounded to the nearest 0.1%. Percentage of income based on the average total income by Greater Capital City Statistical Area (ABS Personal Income, 2020-21), adjusted by the ABS Wage Price Index (Sep-2023) for each state.
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