"Is Now a Good Time to Buy in Melbourne?"
The Counter-Cyclical Opportunity: Why 2025/26 is the Sweet Spot for Every Buyer
I get asked this question every single week, and my answer is always the same: if you wait for the mainstream headlines to scream "Now is the time to buy," you’ve already missed the bottom of the cycle.
At Specific Property, our client base is split 50/50 between savvy investors and lifestyle-driven owner-occupiers. While their end goals differ, the current "buy" signal for both is exactly the same. We are witnessing a classic counter-cyclical window where Melbourne is offering value that simply doesn't exist in Sydney or Brisbane.
The "Catch-Up" Forecast: Why 2026 is Different
For the last couple of years, Melbourne has been the "quiet achiever" (and at times, the laggard) compared to the explosive growth in Perth and Brisbane. But the tide is turning. KPMG recently forecast that Melbourne will lead the nation in 2026, with house prices tipped to rise by 6.6% and units by 7.1%.
For an owner-occupier, this means that the $1M home you buy today could be worth an extra $65,000 by this time next year. For an investor, it’s the capital growth "bounce" you've been waiting for.
1. For the Owner-Occupier: Upgrading Without the "Upgrade Tax"
If you are looking to sell your current home and move into something larger or in a better school zone, now is the time to strike. Because the Melbourne market has been stable rather than "booming," the gap between a standard 3-bedroom home and a premium 4-bedroom home is currently at a manageable level.
Once the market enters a high-growth phase, that gap widens quickly. By buying now, you are locking in your "forever home" before the competition becomes fierce and the auction prices start blowing out.
2. For the First Home Buyer: Government Support is at an All-Time High
I’ve never seen a better "concession landscape" for first-home buyers in Victoria than right now.
The 5% Deposit Scheme (HGS): This has been a game-changer. Eligible buyers can get into the market with just a 5% deposit and pay $0 in Lenders Mortgage Insurance (LMI). In Melbourne, the price cap for this has recently been increased to $950,000, opening up hundreds of suburbs that were previously out of reach.
Off-the-Plan Stamp Duty Savings: The Victorian Government has extended the massive stamp duty concession for off-the-plan apartments and townhouses until October 2026. This isn't just for FHBs anymore; it’s for everyone. You could save tens of thousands in tax simply by choosing a high-quality new build.
3. For the Investor: Yields are Rising, Competition is Low
While owner-occupiers are looking for kitchens and school zones, my investor clients are looking at the 1.1% vacancy rate. Rents in Melbourne have surged, and with the "supply squeeze" continuing (we are building 30% fewer homes than we need), your rental income is more secure than ever.
Melbourne is currently "undervalued" by about 13% compared to historical ratios with Sydney. Buying now means you are positioned before the anticipated interest rate cuts in mid-2026, which historically trigger a rush of buyers and a spike in prices.
The "Wait and See" Trap
The biggest risk in the current market isn't buying—it’s waiting.
The "Rate Cut" Rush: The moment the RBA cuts rates, borrowing capacity increases. When everyone can borrow 5% more, they spend 5% more. If you buy before the cuts, you win.
The Supply Reality: We have a 200,000-dwelling shortfall in Victoria. You cannot "wait" for more supply to bring prices down; it simply isn't coming fast enough.
My Director's Verdict: Whether you're looking for a backyard for the kids or a high-yield asset for your portfolio, the window to buy in a relatively "calm" Melbourne is closing. 2026 will be the year of the decisive buyer.
