“November Market Update at a glance”
Here’s your November property news, a fast wrap on prices, stock, rentals and sentiment across metropolitan Melbourne and Regional Victoria.
Nationally Australia’s housing market notched up its third consecutive month of 1.0% growth in November, according to Cotality’s national Home Value Index, but the pace of gains is starting to ease. Growth has moderated slightly from October’s 1.1%, with the larger capitals of Sydney and Melbourne now acting as a drag on the national average while the mid-sized capitals continue to surge. Perth grew 2.4% for the month, Brisbane, Adelaide and Darwin 1.9%, and Hobart 1.2%. The Brisbane market hit a milestone, with its median dwelling value reaching over million mark.
Melbourne: steady rather than spectacular
Melbourne dwelling values rose a modest 0.3% in November, taking quarterly growth to 1.6% and annual growth to 4.2%. The city’s median dwelling value now sits at $823,495. While that’s well below Sydney’s median of $1,269,659, it still represents a meaningful lift for homeowners over the past year and a total return (capital growth plus rent) of 7.8%.
Houses vs units
Detached houses in Melbourne outperformed units over the year. House values rose 5.0% over the 12 months to November, with the median house price now just under the million-dollar mark at $978,392. Units recorded a gentler 2.2% annual rise, with a median of $637,830. Only two capital cities’ have a cheaper median unit price than Melbourne Hobart with $567,828 and Darwin with $424,417.
From an income perspective, gross rental yields remain tight. Across all Melbourne dwellings, the gross yield sits around 3.6%, with houses at roughly 3.1% and units at an impressive 4.8%.
Regional Victoria holding its own
Regional Victoria continues to track just ahead of metropolitan Melbourne on an annual basis. Regional dwelling values rose 0.8% in November, 2.1% over the quarter and 5.1% over the year, with a median value of $612,216. Within the regions, markets such as Mildura, Bendigo, Shepparton, Wodonga, Alpine, Ballarat and Heathcote, Castlemaine, Kyneton have all posted annual growth of around 9 to 18%, supported by relative affordability, lifestyle appeal and solid local employment bases. These pockets remain attractive to both owner-occupiers and investors willing to look beyond Melbourne for yield and long-term growth.
Rental market: tight but improving slightly for renter
Nationally, rental markets remain extremely tight, with vacancy rates stuck near record lows at around 1.5%. Rents rose another 0.5% in November to be 5.0% higher over the year. For the typical household, rent now consumes just over one-third of pre-tax income, a new record high burden.
Melbourne is recording one of the milder rental upswings amongst the capitals, but renters are still facing rising rents and limited choice.
External forces shaping the Melbourne market
Several broader economic and policy factors are now exerting a strong influence on the Melbourne market:
- Affordability and borrowing power
Across Australia, the median dwelling value is now 8.2 times annual household income, and servicing a mortgage on the median home absorbs around 45% of pre-tax income. These ratios are at or near record highs and are increasingly acting as a natural speed limit on further price growth, even in relatively more affordable cities such as Melbourne. - Interest rates and sentiment
With annual inflation for October at 3.8% and being still above the RBA’s 2 to 3% target band, market expectations have shifted away from near term rate cuts into near term rate increases. - Macroprudential tightening
APRA has announced that, from 1 February 2026, no more than 20% of new lending written by banks can be at debt-to-income ratios of six times or more. While most recent loans already sit below this threshold, it is a clear signal that regulators are watching household leverage closely. - Low construction and listing supply
Across the country, listings remain below their long term average, and the pipeline of new housing is constrained by labour shortages, elevated construction costs and competition from large public infrastructure projects. Builders’ margins, especially in the multi-unit sector, remain thin, which limits the speed at which new supply can respond. This tight supply backdrop is helping to underpin prices in both Melbourne and regional Victoria despite affordability headwinds.
What this means for buyers and sellers
For Melbourne sellers, November’s numbers confirm that the market remains in positive territory, but the days of rapid month-on-month gains are behind us for now. Buyers are more price-sensitive, auction clearance rates have drifted back into the low-60% range, and well-presented, correctly priced homes are the ones attracting competition.
Overall, we expect Melbourne and regional Victoria to continue recording moderate growth into 2026, but within a more finely balanced market where realistic pricing and good advice will matter more than ever.
Remember, the information provided is of a general nature, always seek independent legal, financial, taxation or other advice in relation to your unique circumstances.
- Free Sales Price Report: https://www.obrienrealestate.com.au/property-report/
- Free Rental Report: https://www.obrienrealestate.com.au/rental-report/
- View our Annual Axis Report: https://www.obrienrealestate.com.au/axis/
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