Looking for the cheapest suburbs in Melbourne to buy a property or the most affordable suburbs to rent in the Victorian capital?
Thanks to the downturn in property values it is actually more affordable to buy or rent a house or apartment in Melbourne than it was a year ago.
With national housing values down 7.2 per cent since their October 2017 peak to the end of March this year, most analysts are predicting more of the same for 2019 notwithstanding the Coalition's surprise election win, though according to CoreLogic the rate of decline is easing.
According to CoreLogic Melbourne housing prices are down -10.02 per cent year-on-year to April 2019, with houses suffering more (-12.60 per cent) than units (-4.14 per cent) over this timeframe.
This is bad news if you are looking to sell but a positive for anyone looking to snag a bargain, particularly in the cheapest suburbs in Melbourne. This is especially true if you're a first home buyer where housing affordability has long been an obstacle to getting on the property ladder, especially in our capital cities.
If you are renting, paying less every week or month on accommodation means you can save faster for a deposit or a holiday - we'll leave that to you!
Cheapest suburbs to buy in Melbourne
When it comes to identifying the cheapest suburbs to buy in Melbourne there is a strong correlation between geography and price. This holds true for anywhere, hence the saying: location, location, location!
When it comes to the most affordable suburbs in Melbourne, you need to start your search in the west, where the cheapest areas to buy are located. These areas are farther from the CBD, though with decentralisation there are now more job opportunities and amenities here than previously.
"When it comes to the most affordable suburbs in Melbourne, you need to start your search in the west, where the cheapest areas to buy are located."
Here you can expect to buy a house for less than $400k and have some change. Opt for a unit and you could be spending under $300k. It's useful to benchmark these median values against Melbourne's (April 2019) median house price of $725,000, while units are at a median of $550,000.
Top 5 cheapest suburbs in Melbourne
According to a new joint study released by Aussie Home Loans/CoreLogic - Australia's most affordable suburbs - the suburb of Melton is the cheapest suburb in Melbourne with a median house price of $389,190. This is the only Melbourne suburb where you can buy a detached house for under $400k.
Other suburbs in the Melton Council region feature prominently in the top 5 cheapest suburbs. Based on median house values, you could find a bargain in:
- Melton - $389,190
- Melton South - $404,812
- Millgrove - $419,830
- Cobblebank - $434,888
- Kurunjang - $436,026
The median house price in Melton has grown 89.5 per cent over the last decade, while houses in Kurunjang have appreciated by 99.6 per cent over the same timeframe.
"Melton is the cheapest suburb in Melbourne with a median house price of $389,190 - the only postcode in the city where you can buy a house for under $400k"
If you are on the market for an affordable unit or apartment, then these are the top 5 Melbourne suburbs to look out for based on median prices:
- Junction Village - $303,505
- Bacchus Marsh - $318,393
- Albion - $320,234
- Darley - $325,919
- Melton South - $329,168
Units have appreciated 35.2 per cent in Junction Village over the last decade and all sales in the last year have been for units in the sub-$400k range. Units in Bacchus Marsh and Albion have been an even better investment over the long term, appreciating 66 per cent and 91.4 per cent respectively over the last 10 years.
Cheapest Melbourne suburbs within 10 kilometres of the CBD
If you want a manageable commute to the city or want to be closer to the action, then you need to start looking for suburbs that are within striking range of the Melbourne CBD.
A useful guide is to set a 10km radius to refine your search, but be prepared to pay more for the privilege. Based on this criteria, many of the city's inner west could tick your box, where the median house price is under $800k.
Start with Maidstone, with a median house value of $738,813, it's the cheapest suburb to buy within 10km of the CBD. Pros of the suburb include close proximity to Victoria University and a relatively short commute to the city. Other suburbs to put on your shortlist include:
- Coburg North - $750,857
- Belifield - $766,227
- Footscray - $804,367
"Maidstone, with a median house value of $738,813, is the cheapest suburb to buy within 10km of the Melbourne CBD"
If you're after a unit, then the cheapest units within the 10km zone are in Carlton which has a median price of $329,228. It is also worth exploring:
- Travancore - $355,798
- Flemington - $376,064
- Kingsville - $420,586
If you had bought a unit in Carlton ten years ago your investment would have appreciated a respectable 43 per cent to date.
Cheapest Melbourne suburbs within 20 kilometres of the CBD
If those prices are too rich for your blood, then simply broaden your search area to a 20 km radius. This takes you into sub-$500k territory and areas like Coolaroo in Melbourne's northern suburbs, which has a median house price of $453,602 - and where prices have jumped 98.9 per cent over the last decade. Other suburbs to shortlist include:
- Campbellfield - $476,636
- Meadow Heights - $477,952
- Dallas - $481,376
Coolaroo and Dallas are just 18 kilometers from the city centre, and a lot more affordable than most inner city suburbs.
If a unit is a must then Albion, in Melbourne's inner west fringe, is the cheapest suburb within 20 kilometres of the CBD, with a median value of $320,234. Units here have appreciated 91.4 per cent over the last ten years. Other suburbs to shortlist include:
- Notting Hill - $322,055
- Caulfield East - $375,801
- Flemington - $376,069
Cheapest suburbs to rent in Melbourne
When it comes to renting in Melbourne, prices have been steady in the first quarter of 2019, with median unit rents slightly up (2.4 per cent) at $420/week, while house median rents have held firm at $440/week. This is a similar trend to Sydney, which is no longer the country's most expensive place to rent - Canberra has now claimed that title.
"Like property prices, rents tend to decrease the further you are from an urban centre."
If you are looking for the cheapest place to live in Melbourne then you will need to focus on suburbs further from the CBD. Like property prices, rents tend to decrease the further you are from an urban centre.
Cheapest suburbs to rent within 10 kilometres of the CBD
If you still want to live fairly close to the city for your job, or you like being within easy reach of all it has to offer in the way of shopping and entertainment, then try renting in a suburb within 10km of the CBD. Options to try here include:
- West Footscray - half an hour to the city - where the median house rent is $450/week, while the median rent for units is $330/week
- Kingsville - 9 km from the CBD - where the median house rent is $490/week, while the median rent for units is $320/week
- Brunswick - 6 km from the CBD - where the median house rent is $580/week, while the median rent for units is currently $420/week
Inner city Brunswick is particularly popular, and has morphed into a multicultural neighborhood of hip cafes with a colourful mix of Victorian homes and newer apartments as a backdrop.
Cheapest suburbs to rent within 20 kilometres of the CBD
If those rents are too much, you'll have to look further afield and expand your zone to suburbs within 20 kilometres of the city. Postcodes to focus on include:
- Glenroy - 15 km to the CBD - where the median house rent is $380/week, while the median rent for units is $380/week
- Bundoora - 16 km from the city - where the median house rent is $410/week, while the median rent for units is $370/week
- St Albans - 20 km from the city - where the median house rent is $350/week, while the median rent for units is $325/week
Glenroy is particularly convenient being so close to the city, airport, shops and offers easy access to train lines and freeways. Bundoora is also a good choice as the uni town offers a spacious, relaxed vibe.
Suburbs further than 20 kilometres of the CBD
If you are bothered by being close to the city centre and/or are looking for even lower rental accommodation, then you could look even further afield - 20 km+ from the CBD. Suburbs to research here include:
- Meadow Heights - 21 km from the city - where the median house rent is $368/week, while the median rent for units is $350/week
- Williams Landing - 25 km from the city - where the median house rent is $450/week, while the median rent for units is $380/week
- Ringwood - 28 km from the city - where the median house rent is $420/week, while the median rent for units is $370/week
Ringwood is popular among families who appreciate the chilled lifestyle and easy access to the bush, but with all the amenities they need including schools, shopping and transport.