Melbourne, known as Australia’s garden city, where the love for art descends over the city like confetti and clings to every street corner has a lot to offer for the rental market. It's no surprise that the rental costs in Melbourne used to be at the top of the country.
Now, renting a property in Melbourne shouldn’t cost you more than it would in Hobart! Ask Melbourne property managers, it's true!
The recent COVID-19 pandemic transformed Melbourne’s rental trends. Inner-city areas of Melbourne were hard-hit by the decline in tourism and international student influx.
Add to that the volume of tenants deserting cramped properties in the city to move into more spacious homes in suburban areas, and the new average rent in Melbourne doesn’t come across as much of a surprise.
In this article, we will analyse the rental trends in Melbourne and its suburbs.
What is the average rent in Melbourne?
The average rent in Melbourne per week is $440 for houses and $400 for units, according to a Domain rental report (September 2020).
This is a 2.3% increase for houses since the previous quarter, and a drop of 3.6% for units.
Average rent in Melbourne over the past 5 years
In 2017, high investor activity in Melbourne caused the lowest growth in rental prices since the past 20 years. Unit rental prices climbed by 13.5% and detached houses by 11.6%. However, this period showed only a passive growth.
Fast-forward to a COVID-19 rental market, the prices indicate a sorrier tale - unit median rental prices fell to its lowest in 3 years, according to Domain property update.
That being said, house prices indicate a marginal increase as of late, which has restored some faith in the Melbourne rental market trends.
Median rent in Melbourne for houses from the past 5 years (2016-2020):
The average rent in Melbourne, Australia for houses peaked in 2020 despite the pandemic. The resilient nature of the rental market trends is backed by government support and the need for larger houses as tenants spent more time indoors due to the lockdown.
- Melbourne median weekly house rent 2020: $440
- Melbourne median weekly house rent 2019: $430
- Melbourne median weekly house rent 2018: $430
- Melbourne median weekly house rent 2017: $425
- Melbourne median weekly house rent 2016: $410
Source: Domain rental report.
Median rent in Melbourne for units from the past 5 years (2016-2020):
Rental price for apartments in Melbourne bounced back to 2017 levels because of falling demand for vertical living during the pandemic. Lower immigration and the spur in work from home trends led to this decline.
However, until the onset of the pandemic, the median rental prices show a persistent increase between 2016 and 2019.
- Melbourne median weekly unit rent 2020: $400
- Melbourne median weekly unit rent 2019: $420
- Melbourne median weekly unit rent 2018: $410
- Melbourne median weekly unit rent 2017: $400
- Melbourne median weekly unit rent 2016: $380
Source: Domain rental report.
Average rent in Melbourne by suburb or area
Suburb/Region | Average weekly rent |
|---|---|
Inner Melbourne (Brunswick - Coburg, Darebin - South, Essendon, Melbourne City, Port Phillip, Stonnington - West, Yara) | $450 |
Inner Eastern Melbourne (Boroondara, Manningham - West, Whitehorse - West) | $450 |
Southern Melbourne (Bayside, Glen Eira, Kingston, Stonnington - East) | $475 |
Western Melbourne (Brimbank, Hobsons Bay, Maribyrnong, Melton - Bacchus Marsh, Wyndham) | $380 |
North Western Melbourne (Keilor, Macedon Ranges, Moreland - North, Sunbury, Tullamarine - Broadmeadows) | $400 |
North Eastern Melbourne (Banyule, Darebin - North, Nillumbik - Kinglake, Whittlesea - Wallan) | $400 |
Outer Eastern Melbourne (Knox, Manningham - East, Maroondah, Whitehorse - East, Yarra Ranges) | $410 |
South Eastern Melbourne (Cardinia, Casey - North, Casey - South, Dandenong, Monash) | $380 |
Mornington Peninsula (Frankston, Mornington Peninsula) | $390 |
Barwon-South West | $370 |
Gippsland | $310 |
Goulburn-Ovens-Murray | $320 |
Loddon-Mallee | $320 |
Top 10 suburbs with highest weekly rent in Melbourne
Southern Melbourne had the highest median weekly rent during the 2nd quarter of 2020 at $475. This was closely followed by Inner Melbourne and Inner Eastern Melbourne.
Rank | Suburb | Median Weekly Rent | Annual Change |
|---|---|---|---|
1 | Southern Melbourne (Bayside, Glen Eira, Kingston, Stonnington - East) | $475 | -1.0% |
2 | Inner Melbourne (Brunswick - Coburg, Darebin - South, Essendon, Melbourne City, Port Phillip, Stonnington - West, Yara) | $450 | -10.0% |
3 | Inner Eastern Melbourne (Boroondara, Manningham - West, Whitehorse - West) | $450 | -4.3% |
4 | Outer Eastern Melbourne (Knox, Manningham - East, Maroondah, Whitehorse - East, Yarra Ranges) | $410 | 0.0% |
5 | North Western Melbourne (Keilor, Macedon Ranges, Moreland - North, Sunbury, Tullamarine - Broadmeadows) | $400 | 0.0% |
6 | North Eastern Melbourne (Banyule, Darebin - North, Nillumbik - Kinglake, Whittlesea - Wallan) | $400 | 0.0% |
7 | Mornington Peninsula (Frankston, Mornington Peninsula) | $390 | 0.0% |
8 | Western Melbourne (Brimbank, Hobsons Bay, Maribyrnong, Melton - Bacchus Marsh, Wyndham) | $380 | 0.0% |
9 | South Eastern Melbourne (Cardinia, Casey - North, Casey - South, Dandenong, Monash) | $380 | 0.0% |
10 | Barwon-South West | $370 | 2.8% |
Future projections for average rental price in Melbourne
Melbourne’s property market prices are forecasted to increase by 9% in 2021 according to Property Update’s 2021 predictions.
Despite a significant change in property value from 12% increase before March 2020 to a 34% sharp decline during the pandemic, the latest figures seem to be promising. There has been a 0.22% rise in property values in November 2020.
A rise in property prices project a positive image for the rental market as well. Better consumer confidence, more lending and job opportunities suggest the rental market across Melbourne could benefit from fresh demand in 2021
Although the inner areas of Melbourne are now known as the tenants’ market due to lower unit prices, not all suburbs in Melbourne are equally affected. House rental prices continue to be growing, especially if they are more appropriate for families spending excessive time indoors.
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