Melbourne saw just over 1,400 new apartment completions in the first quarter of 2026

• Melbourne saw just over 1,400 new apartments complete in the first quarter of 2026. There are currently 4,000 units under construction set to complete in 2026, with over 1,000 of these in the outer Melbourne precinct.
• Melbourne’s apartment market is starting to see confidence return. The median apartment price now sits at $620,000, seeing 2.9% growth year-on-year. This is the highest year-on-year growth seen since mid-2022.

Median apartment sale price in Melbourne saw 2.9% growth year-on-year, showing confidence returning to the market

• Median apartment rents saw 3.6% year-on-year growth in Melbourne. In contrast, median house rents have seen negative year-on-year growth, down 1.7%. Median apartments rents are now higher than house rents, at $575 and $570 across the greater city, respectively.
• Melbourne continues to have the highest rental vacancy rate among Australia’s largest cities; however, this is coming down. The rental vacancy rate as at February 2026 was 1.6%, sitting well below the long-term average of 2.3%.

Apartment rents are continuing to outperform house rents as they start to see negative year-on-year growth

• Apartment sales volumes have seen a slight reduction from a period of increased activity
• New apartment leases have seen a dramatic decrease, down 41.6% on the previous year, with people preferring to stay put, amid rising rents.

Outlook

• Melbourne’s position as a well-established market will see price and rent growth as well as transactional activity pick up once again. Melbourne is expected to see new apartment completions pick up in 2028 and 2029. However, this pipeline is still largely tentative, with market conditions possibly delaying the commencements of construction.
• Investors are still tentative to enter the market, with tax settings subduing activity. However, there is a robust supply pipeline for build-to-rent (BTR) apartments supported by rental growth will continue to see some new apartments delivered to the Melbourne market to meet demand from its continued population growth.