M:
Headlines
Winter/26
Melbourne Prestige
Residential
Prestige residential sales
Prestige sales
Melbourne recorded a lower number of prestige residential sales above $3 million over the past year Sales trended down 14% with a total of 1,100 transactions in the year ending Q1/26, being outpaced by the five year annual average of 1,337 sales. Sales activity tends to shift with interest rate movements and changes in economic confidence, while ongoing global uncertainty continues to influence decision-making Isolating the 188 sales in the Q1/26 quarter, this was 60% below the previous quarter whilst lower than the 261 five year quarterly average
Super-prestige sales
The share of super-prestige sales (above $5 million) was recorded at 34%, compared to the total number of prestige sales (above $3 million) across Melbourne in the year ending Q1/26. This was higher than one year ago when the proportion was 22%, and remains above the 19% share recorded five years ago Over the past year, Melbourne’s super-prestige sales volume has grown by 31%, whilst rising over the past five years by 187%
Rolling tally of annual prestige residential sales Melbourne prestige ($3m+)
Share of super-prestige sales ($5m+), by number Melbourne prestige
Prestige residential sales
Sales velocity +1 day
Average days on the market
Melbourne prestige homes are taking more time to sell than one year ago Prestige homes across Melbourne averaged 80 days on market in the year ending Q1/26, from the time they were listed to the day they went under contract This duration was 81 days a quarter ago (-1 day) and 79 days one year ago (+1 day). A lower number of days on market typically indicates that homes are selling more quickly, often reflecting strong buyer demand and well priced, desirable properties In contrast, a higher number of days on market may signal slower buyer activity Looking back over the five-year average, it has taken 79 days to sell a home -3.4% -1.4%
New listings
Less Melbourne homes have been newly listed for sale than this time last year. Newly advertised listings in Melbourne were 3 4% lower in the month of March 2026 than the equivalent period last year, according to Cotality. This change in new listings trended below the Australian average of -3 3% but above the -6 3% across Australian capital cities
Total listings
Overall, the total number of homes listed for sale in Melbourne is down on last year. Melbourne's total number of listings in the month of March 2026 were 1 4% below the equivalent period last year, according to Cotality. By comparison, the Australian average change for total listings was -11 5% and across Australian capital cities was -8 6%
Tracking prestige prices Melbourne prestige Prestige prices
Melbourne residential property prices have trended lower than a year ago across the prestige market Melbourne prestige property prices fell by 1 6% in the year ending Q1/26, with a fall of 0 7% recorded in the last quarter Looking back at price growth since Q1/21, prestige apartments (14.3%) outpaced prestige houses (5 7%) over the five years In Q1/26, prestige house prices were 0.1% lower and were 6.5% lower on the previous year In the same quarter, prestige apartment prices fell by 1 5% after rising 4 9% in the past year Annual residential price growth has averaged 2 0% over the past five years
Prestige price outlook
Looking ahead, Melbourne residential prestige prices are likely to fall over the coming year McGrath Research forecasts Melbourne prestige residential prices to contract by 4% by the end of 2026, followed by a 1% rise in 2027 Factors taken into consideration include the projection of a challenged economy and business environment, a solid performing stock market, anticipated pressure on the interest rate target, as sales volume remain lowered.
Forecast for prestige prices Melbourne prestige
change from a year ago
Prestige yield
+22 bps
Melbourne prestige gross rental yields have trended higher over the past year Residential gross rental yields rose 8 bps in the Q1/26 quarter to be 3 77% across the Melbourne prestige market, whilst being 22 bps more than a year ago. Gross rental yields are a good initial measure of comparing the return of a property investment before expenses are deducted A yield greater than 3% tends to be considered most desirable for prestige properties located in capital cities, while below this, tends to indicate high property prices relative to rent, or low rental demand Gross rental yields have averaged 3.25% over the past five years.
The number of residential rental homes in Melbourne is currently undersupplied. Melbourne rental vacancy was recorded at 2 5% at the end of Q1/26, rising 10 bps in the quarter whilst changing 0 bps over the past year according to REIA Generally, around 3% vacancy is considered a balanced market between rental supply and demand Below this equilibrium is considered to be an undersupplied pool of rental homes, which places upward pressure on weekly rents. For the past five years, Melbourne residential rental vacancy has averaged 3 3%
Gross rental yield
from a year ago
Residential rental vacancy
Prestige rents
+5.4%
Tracking prestige rents
Melbourne prestige
Residential rents across Melbourne trended above the weekly prestige rate recorded a year ago Melbourne prestige property rents rose by 5 4% in the year ending Q1/26, with a rise of 1 2% recorded in the last quarter Looking back at rental growth over the five years since Q1/21, prestige apartments (59.0%) outpaced prestige houses (35 4%) Prestige apartment rents in Q1/26 were 1 5% above a quarter ago, and were 7.1% higher over the year. In the same quarter, prestige house rents rose by 0 9% after rising 3 7% over the past year On average, in the past five years, prestige rents grew 7 9% per year
Prestige rental outlook
+4%
The Melbourne prestige residential market is continuing to experience upward pressure on weekly rents A sustainable number of new homes have been built in Melbourne but only a modest number have been made available in the prestige rental pool. As a result, McGrath Research forecast there will remain upward pressure on rents of 5% at the end of 2026, with a further 4% rental growth likely in 2027
Forecast for prestige rents
Melbourne prestige
Melbourne prestige, Q1/26
change from a year ago
Definitions
Prestige property
The most desirable and most expensive property in a given location, generally defined as the top 5% of each market, by value.
Prestige sales
Melbourne prestige sale transactions hold a threshold of A$3 million
Super-prestige sales
Melbourne super-prestige sale transactions hold a threshold of A$5 million.
UHNWI
An ultra-high-net-worth individual (UHNWI) is someone with a net worth of US$30 million or more.
Guiding
you home
Michelle Ciesielski National Head of Research, McGrath Research
www.mcgrath.com.au/research
