Regional Victoria’s residential property market continued to strengthen in the third quarter of 2026, with both houses and units recording price growth, while Melbourne saw a mixed but resilient performance.
According to the latest quarterly median data published by the Real Estate Institute of Victoria (REIV), regional house prices rose 1.2 per cent to $673,500 and units increased 0.2 per cent to $469,500. Growth was spread across the state, with the Shire of Moira recording a 9.1 per cent rise, driven by Cobram, which climbed 9.3 per cent to $470,000. In Gippsland, houses in the City of La Trobe rose 6.5 per cent, led by Morwell, up 7.6 per cent to $424,900, Churchill, up 5.9 per cent to $513,000, and Traralgon, up 4.5 per cent to $660,000.
With successive interest rate rises reducing borrowing capacity, demand grew for the relatively more affordable homes. This is demonstrated in the more affordable end of the market generally holding up better under softer conditions.
For the September quarter, in metropolitan Melbourne, lower-quartile house prices fell 2.7 per cent compared with a 4.0 per cent decline at the upper end, while lower-quartile units fell 1.0 per cent compared with 3.1 per cent for the upper quartile.
The annual figures make the trend even clearer. Metropolitan Melbourne’s lower-quartile house prices rose 4.9 per cent over the year compared with 0.1 per cent at the upper end, while lower-quartile units increased 4.2 per cent compared with 1.2 per cent. In regional Victoria, lower-quartile house and unit prices rose 13.1 per cent and 11.9 per cent respectively.
In metropolitan Melbourne, overall median prices for both houses and units softened 0.7 per cent over the quarter, with the median house price at $943,000 and unit price at $634,000.
Despite the softer metropolitan result, pockets of growth remained across Melbourne. Mount Eliza recorded the strongest quarterly house price growth at 9.1 per cent to $1.8 million, followed by Brunswick, up 7.8 per cent to $1.25 million, Glen Iris, up 7.7 per cent to $2.412 million, Yarraville, up 6.6 per cent to $1.2 million, and Port Melbourne, up 6.3 per cent to $1.53 million.
Over the year, metropolitan Melbourne also remained in positive territory, with house prices up 3.8 per cent and units and apartments increasing 2.4 per cent, demonstrating continued underlying strength.
Regional Victoria also continued to offer a significant affordability advantage, with a median house price of $673,500 compared with $943,000 in metropolitan Melbourne, while regional units and apartments recorded a median of $469,500 compared with $634,000 in Melbourne.
REIV CEO Toby Balazs said the latest data showed Victoria’s property market was holding up well in response to national policy and macro-economic changes.
“This is the first full quarter showing the market’s response to changes in federal tax policy and recent increases to the cash rate. While transaction volumes have softened, it’s clear Victoria’s property market is resilient, with regional towns and many Melbourne suburbs even showing capacity to rise.
“Broader market conditions are still challenging, and in this market it’s vital Victoria has policy settings that encourage participants to buy, sell and invest with confidence, particularly at a time when higher borrowing costs and cost-of-living pressures are weighing on households.
“As a priority, the next Victorian Government must commit to reviewing counter-productive auction and property sale reforms, reviewing first home buyer stamp duty exemption thresholds, easing the tax burden on rental investment and avoiding further regulation that adds unnecessary cost and complexity to property transactions.”
Media Contact: media@reiv.com.au - 03 9205 6607