Victoria Real Estate Market 2026: What’s Coming Next?

Victoria Real Estate Market 2026: What’s Coming Next?

Prepare for the New Year ✨

If 2025 felt like a rollercoaster, you’re not imagining it. Between shifting interest rates, tight rental markets and buyers trying to time the “bottom”, Victoria’s property scene has been… busy.

The good news? Most of the big forecasters are now singing a much more optimistic tune for 2026 – especially for Melbourne and wider Victoria.

Let’s break down what’s ahead, in plain English, with a few emojis and zero jargon where possible.

📊 Where We’re At: Late 2025 Snapshot

Before we look forward, a quick look at now:

  • Melbourne home values have been creeping up steadily in 2025, with annual growth of around 4% and a median around the low–mid $800,000s depending on the data set.

  • Other sources tracking Melbourne show consistent but moderate gains, with house prices up a few per cent over the year and a median house price just under the $1M mark.

  • Nationally, growth has re-accelerated because demand is running ahead of supply, with advertised stock well below average – a big reason prices are nudging up again.

In short: 2025 has been a rebuild year for Victoria – not boom-level crazy, but a clear move away from the softness and declines we saw earlier in the decade.

🚀 2026: Is Victoria Heading for a Mini-Boom?

A lot of eyes are on Melbourne in particular, and the forecasts are… actually pretty exciting:

  • Recent residential outlooks have Melbourne tipped to lead the nation in 2026, with house prices forecast to rise about 6.6% and units to jump about 7.1%.

  • Analysts note that Melbourne had a longer, deeper downturn than some other capitals, which means there’s more room for a catch-up as confidence returns.

  • Broader forecasts for 2025–2026 have Sydney and Melbourne leading national growth, helped by lower interest rates and ongoing housing undersupply.

So no, we’re not talking about wild speculative booms – but we are talking about solid, healthy growth for Victoria if these projections hold.

⚙️ What’s Driving the 2026 Outlook in Victoria?

A few big forces are working together:

1. 🌡️ Interest Rates: From Pain to Relief

Higher rates hit Melbourne hard, but rate cuts and stabilisation are now flowing through:

  • Falling/steady rates are lifting buyer sentiment and making repayments slightly more manageable.

  • Affordable and mid-priced segments are leading growth as more buyers can finally say, “Okay, now the numbers work.”

2. 🏗️ Tight Supply & Population Growth

Victoria continues to attract strong population inflows, while:

  • New construction has lagged thanks to higher build costs and delays.

  • Advertised listings sit well below average, keeping upward pressure on prices.

Result? Good-quality, well-located homes are hot property.

3. 🏙️ Units & Townhouses Back in Fashion

As freestanding houses become less affordable:

  • Units and townhouses are picking up pace, especially in transport-connected suburbs and lifestyle pockets.

  • Analysts are predicting Melbourne’s unit market to be one of the standouts nationally in 2026.

This is huge for first-home buyers and investors who want to enter the market at a lower price point.

4. 💼 Investors Quietly Returning

Recent analysis shows a “quiet comeback” of investors in Melbourne, especially:

  • In the sub-$1M bracket, where yields look attractive again.

  • In value-driven suburbs where rental demand is strong and vacancy rates are low.

Given the ongoing rental squeeze across Victoria, this doesn’t look like it will ease overnight.

👥 What 2026 Means for Different People

For Homeowners & Sellers 🏡

2026 could be a sweet spot if you’ve been waiting for the market to feel “strong” again:

  • Forecast growth of around 6–7% in Melbourne means more equity and potentially better selling conditions.

  • Well-presented homes in family-friendly suburbs and lifestyle locations (hello Frankston, Bayside, Peninsula and surrounds) should remain in high demand.

  • There’s still a window right now where buyers can act before pricing fully reflects these stronger forecasts.

How Us Real Estate can help:
We can step in with realistic appraisals, styling advice, and a strategy that balances timing with presentation – not just “throw it online and hope for the best.”

For Buyers & First-Home Buyers 🔑

Yes, prices are rising – but that doesn’t mean you’ve “missed it”:

  • Early 2026 is expected to be a period where momentum builds: more enquiry, more competition, more FOMO.

  • Units, townhouses and outer- or middle-ring suburbs remain key value plays.

  • Getting your finance pre-approved and being clear about your “must-haves vs nice-to-haves” will matter more than ever.

Where Us Real Estate fits in:
Because we work day-to-day in the Frankston, Bayside and greater Melbourne corridor, we can help you:

  • Spot suburbs that are still underrated

  • Understand realistic price guides

  • Avoid overpaying just because the headline says “boom”

For Investors 💰

2026 is shaping up as a numbers game:

  • Rents are elevated and vacancy remains low in many parts of Victoria, supporting yields.

  • Forecast capital growth in Melbourne houses and units gives investors a double benefit: income + potential equity uplift.

Us Real Estate can help with:

  • Rent appraisals

  • Local vacancy insights

  • Practical advice on what tenants in our areas actually want (pet-friendly? extra parking? low-maintenance yards?).

For Renters 😅

We won’t sugar-coat it: the rental market will likely stay tight into 2026.

  • Strong population growth + limited new stock = continued competition for good rentals.

  • However, more investors returning to the market should slowly add to rental supply.

At Us Real Estate, we try to be the human side of the process – clear communication, fair expectations, and support when things change (like unexpected sales or renovations).

🎯 How to “Prepare for the New Year” – 2026 Checklist

No matter where you sit, here are some action steps:

Owners / Sellers

  • ✅ Get a fresh market appraisal – your property may be worth more than last year’s estimate.

  • ✅ Tackle small maintenance and presentation jobs now so you’re ready to jump when the timing feels right.

Buyers

  • ✅ Sort your borrowing capacity with a broker or bank early.

  • ✅ Shortlist suburbs (and backup suburbs!) in Victoria where the numbers stack up.

  • ✅ Ask us for on-the-ground intel on streets, pockets and rental potential.

Investors

  • ✅ Review your portfolio: rents, expenses, and potential to re-leverage into another property if it suits your strategy.

  • ✅ Consider units and townhouses in growth corridors – data suggests they’ll be 2026’s quiet achievers.

💬 Bringing It Back to Us Real Estate

At Us Real Estate, we live and breathe the local Victorian market – especially around Frankston, Langwarrin, Seaford, the Bayside suburbs and surrounding areas.

  • We’re seeing real-time evidence of the trends the big reports talk about:

    • more buyer enquiry,

    • stronger opens,

    • competitive offers on well-priced homes.

  • Our job is to translate all the big-picture forecasts into clear, practical decisions for you – whether you’re renting, buying, selling or investing.

Property Management Experts

📞 Tamika Thurgood – 0401 431 484
✉️ [email protected]

📞 Monique Robins – (03) 8762 0128
✉️ [email protected]

Sales Team Experts

📞 John Lewis – 0423 487 266
✉️ [email protected]

📞 Karen Day – 0490 242 303
✉️ [email protected]

🌟 Thinking about making a move in 2026?

Reach out to the Us Real Estate team – we’d love to chat through your situation, no pressure, just honest advice.