Melbourne Property Market Heats Up: A Resurgence in Full Swing
Melbourne’s property market is roaring back to life in 2025, with surging buyer demand, a chronic shortage of listings, and investors returning after a two-year hiatus. Signs of intense competition are popping up across the city—especially in the Bayside suburbs—with some agents reporting conditions they’ve never seen before.
Fierce Competition Amid Low Stock
Across Melbourne, properties in high-demand areas are drawing five or more bidders at auction, pushing sale prices well above quoted ranges. The rapid increase in buyer interest is being fuelled by low stock levels, which has led agents to lift price guides to keep up with demand.
In fact, the lack of available homes is so extreme that some agents have had entire Saturdays off—not by choice, but because they’ve sold everything on their books, including off-market stock. Many say it’s a first in their career.
Substantial Price Growth in Key Suburbs
According to the REIV March 2025 Quarterly Report, select Melbourne suburbs have posted impressive price growth, particularly throughout Bayside:
Mordialloc – Units and apartments surged 26.9%
Port Melbourne – House prices increased 18.6%
Elwood – Median house price climbed 8.9%
Beaumaris – Quarterly house price growth of 6.7%
Brighton – Units/apartments now have a median of $1.355M, among the city’s highest
Sandringham – House prices holding steady with signs of renewed buyer momentum
These figures point to a growing trend of accelerated growth in lifestyle-rich suburbs. With competition heating up in these pockets, it’s only a matter of time before it spills over into other areas of Melbourne.
RBA Rate Cuts Could Spark a Buying Frenzy
The Reserve Bank of Australia is tipped to cut interest rates in the coming months. NAB’s chief economist forecasts a cash rate drop to 3.1% by August, and potentially 2.6% by early 2026.
Cheaper borrowing will boost buying power, further intensifying demand—and likely adding fuel to already rising property prices.
Investors Are Back
After a long quiet spell, investors are re-emerging in Melbourne. Investor loan volumes were up 26.3% year-on-year by September 2024, making up 32% of all new housing loans. With rental returns rising and capital growth back on the cards, investment activity is especially strong in beachside and inner-city locations.
Government Incentives Support Buyer Demand
The Victorian Government’s decision to extend stamp duty concessions until October 2026 is helping to stimulate buyer activity, particularly for off-the-plan homes and apartments. These policies are giving buyers additional confidence, particularly first-time and downsizing buyers looking for value.
Outlook: Momentum Still Building
All signs suggest that Melbourne’s property resurgence is still in its early stages. Strong buyer demand, limited listings, and falling interest rates form a powerful trio—and while some areas are already booming, others are just warming up.
If you're looking to buy before the next surge, now might be the time to act.
Looking to invest?
The team at Turley Property Advocates is committed to helping you realise your dream. If you’d like a no-obligation consultation to discuss your next move, contact Corinne at corinne@turleypropertyadvocates.com.au or 0417 541 111.