Melbourne dwelling values currently remain 1.3% below the March 2022 peak (PropertyUpdate/Cotality). While the March 2026 quarter saw a 0.6% decline (PropertyUpdate/Cotality), the marginal gap from the peak is less critical than current buyer demand and property-specific attributes.
Many vendors are still benchmarking their equity against the record growth of 2020–2021. This focus overlooks the fact that Melbourne has already moved through a significant 8–10% correction during 2022–2023 and a strong recovery throughout 2025.
The gap from the March 2022 peak
Current data shows Melbourne dwelling values are only 1.3% below their March 2022 peak (PropertyUpdate/Cotality). This follows a strong 2025 where median house prices increased by 11–14% (Cotality). The recent 0.6% dip in the March 2026 quarter (PropertyUpdate/Cotality) indicates a plateau rather than a return to the volatility of 2022.
Why property attributes outweigh the peak figure
In the middle and outer rings, land size is the primary driver of overall value for house-and-land packages. Buyers are paying premiums for north-facing living areas, double garages in family suburbs, and updated kitchens and bathrooms, which deliver the highest ROI. Period character features remain key value drivers in inner Melbourne.
Segment-specific recovery trends
Recovery has not been uniform. Affordability-driven suburbs in the south-east led the 2024 recovery, while apartment prices and inner-suburb villa units have seen more recent increases. Outer suburb houses are currently seeing growth as investors and first-home buyers enter the market.
The 2026 rate hike impact
Rate hikes in February and March 2026 have introduced new uncertainty into the market. This is reflected in the flat growth seen in February 2026 and the slight quarterly decline in March (Cotality). It is unclear if these hikes will lead to a sustained price correction or a short-term cooling period.
| Period | Melbourne Median House Price | Annual Growth |
|---|---|---|
| January 2025 | ~$920,000 | – |
| December 2025 | $1,020,000–$1,050,000 | 11–14% (Cotality) |
Frequently asked questions
When is the best time to sell my home in Melbourne?
Spring (September to November) is the peak season with the highest buyer numbers and strongest auction clearance rates. Autumn (March to May) is the second-strongest period, often featuring less competition from other vendors. Winter is the quietest by volume, though motivated buyers remain active.
Which renovations provide the best return on investment?
Kitchens and bathrooms deliver the highest ROI for vendors. Buyers also command a premium for north-facing living areas and outdoor spaces. While energy efficiency features like solar and double glazing are increasingly noted, they are not yet a dominant pricing factor in most segments.
How have Melbourne house prices changed recently?
Median house prices rose from approximately $920,000 in January 2025 to $1,020,000–$1,050,000 by December 2025 (Cotality). However, dwelling values dropped 0.6% in the March 2026 quarter and remain 1.3% below the March 2022 peak (PropertyUpdate/Cotality).
Are entry-level properties still in demand?
Yes, house prices in outer suburbs are increasing as first-home buyers and investors enter the market. The affordable segment (under $800,000) has seen mixed results, but apartment prices and inner-suburb villa units have increased more recently.
Questions to ask your agent
- How has the March 2026 rate hike specifically impacted buyer enquiry levels in my suburb?
- Based on current buyer preferences, which of my home’s attributes (e.g., orientation, garage, land size) will drive the highest premium?
- What is the current difference in clearance rates between Spring and Autumn for properties in my price bracket?
This article contains general market information based on data current as at April 2026. It does not constitute financial, legal, or real estate advice specific to your property or circumstances. For an appraisal and tailored advice, speak with a Fletchers agent in your area.