Melbourne’s housing market continues to surge, with just 16 suburbs remaining under the $600,000 mark. This sharp drop from over 20 suburbs last year is raising concerns about the viability of homeownership for first-home buyers in Victoria.
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Government Assistance Falls Short
The Victorian government’s primary assistance program for first-home buyers, introduced in 2017, provides stamp duty exemptions for homes up to $600,000 and partial exemptions for homes up to $750,000. However, the threshold has remained stagnant, even as house prices have steadily risen.
Economist Anne Flaherty warned that Melbourne’s shrinking pool of affordable suburbs is a sign the government must expand its support.
“There are very few suburbs where first-home buyers can purchase now,” said Flaherty.
In the last financial year, nearly 33,000 Victorians applied for stamp duty reductions or exemptions.
Suburbs Still Under $600K
Here are the 16 Melbourne suburbs where houses are still priced under $600,000:
- Melton: $470,000
- Melton South: $490,000
- Kurunjang: $525,000
- Melton West: $526,500
- Dallas: $539,500
- Coolaroo: $540,000
- Brookfield: $557,500
- Weir Views: $570,000
Suburbs like Broadmeadows, Frankston North, and Meadow Heights are still barely affordable but are expected to cross the $600,000 threshold by 2025 due to gentrification and market demand.
First-Home Buyers Feeling the Squeeze
Flat-fee buyer’s advocate Julie DeBondt-Barker stated that many first-home buyers are being forced to look at properties above $600,000 to find homes in desirable locations.
“First-home buyers are feeling fatigued … many say they’ll have to wait for prices to drop, but that’s unlikely to happen,” she said.
Rising competition has left many frustrated, with some opting to look beyond Melbourne or delay their purchase entirely.
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Melton: Melbourne’s Most Affordable Suburb
Melton continues to lead as the most affordable suburb in Melbourne, with a median house price of $470,000. However, real estate agent Ned Nikolic cautioned that this affordability might not last forever.
“When I started selling in Melton 18 years ago, homes were under $200,000. Now, they’re nearly $500,000, and the area is becoming increasingly attractive to interstate investors,” said Nikolic.
He noted that new housing estates in areas like Bacchus Marsh have driven first-home buyers to Melton, further intensifying demand in the suburb.
Calls for Government Action
Industry experts are urging the Victorian government to raise the stamp duty exemption threshold, arguing that the current $600,000 cap no longer reflects market realities.
If no action is taken, the list of affordable suburbs may dwindle further, pushing first-home buyers out of Melbourne altogether.
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As competition intensifies and affordability wanes, Melbourne’s housing market is becoming increasingly inaccessible for first-time buyers. Without swift action to update assistance programs, the dream of homeownership will slip further away for many Victorians.
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