Melbourne Led Australia on Migration. Prices Still Fell.

Melbourne took in more migrants than any other Australian capital last year. Its house prices fell 1.2%.

Those two facts sit together uncomfortably, and almost nobody selling Australian property will put them in the same sentence. They should, because understanding why they are both true is worth more to you than another article telling you migration guarantees growth.

What the migration numbers actually say now

Net overseas migration was 306,000 in 2024–25, down from 429,000 the year before. Australia's population reached 27.6 million at 30 June 2025.

Melbourne still led every capital city, adding around 105,000 people — though that is well down from the 142,600 it added in 2023–24.

So the picture is: migration is still substantial, still concentrated in Melbourne, and clearly past its peak. Anyone quoting you the 454,400 figure is citing 2023.

And yet prices went down

CoreLogic had Melbourne house values down 1.2% and units down 0.2% over the year to June.

The largest migration intake in the country, and values fell. If migration alone drove prices, that could not happen. So it does not.

Migration drives rents. Interest rates drive prices.

This is the distinction the "booming market" articles skip, and it is the single most useful thing on this page.

A new arrival needs somewhere to live immediately. Around six in ten rent. That lands directly on the rental market, which is why Melbourne vacancy has sat near 1.1% and rents have held up.

But a new arrival does not buy immediately. Most rent for years first, and many never buy. What sets purchase prices is how much buyers can borrow, and that is governed by interest rates. The cash rate is 4.35%, up across 2026, with cuts not expected before 2027.

Rising rates cut borrowing capacity. Falling borrowing capacity caps prices, however many people are arriving. That is why Melbourne can lead the country on migration and still post a negative year.

What this means if you are buying from Singapore

The rental case is sound. Tight vacancy and continued migration mean a well-located new apartment near transport or a university should let quickly and hold its rent. If you are buying for yield or for a child to live in, the fundamentals support you.

The capital growth case is not. Not right now, and not on the strength of migration numbers. Anyone showing you a population chart as a growth forecast is skipping the step where population becomes purchasing power.

The timing question is genuinely open. A flat market with tight rents is not a bad entry point — you are buying without the froth and the rental income starts immediately. But buy it as a long hold, not a two-year trade.

The numbers that will decide your return

For a foreign buyer, the costs move the needle more than the market does over a short hold:

• 8% foreign purchaser duty in Victoria on top of standard stamp duty — A$80,000 on a A$1m purchase
• Absentee owner land tax surcharge, annually, on top of ordinary land tax
• FIRB application fee, scaling with the purchase price
• New dwellings only until 30 June 2029 — established property is closed to you

A 1% market move either way is noise next to that. Which is why I would rather talk to you about total cost and net yield than about migration forecasts.

Who should be buying Melbourne right now

You should be looking if you are ABSD-blocked in Singapore and the entry-cost gap is the reason; if a child is starting at a Melbourne university in the next few years; or if you want a long hold and the rental income matters more than the resale price in 2029.

You should wait if you need growth inside three years, or if the argument that convinced you was a migration statistic. That argument is not doing the work you think it is.

What I would check before committing

• Rental demand in the specific suburb, not the city average — vacancy varies enormously between Southbank and Kensington
• How much new supply is completing nearby in the same window
• Your total entry cost including every Victorian surcharge
• Net yield after owners corporation fees, rates, land tax and management — not gross

If you want an honest read

Tell me your budget and whether this is an investment or somewhere family will live. I will come back with the total cost to completion, a net yield rather than a gross one, and a straight view on whether now is the right entry point for your timeline.

If the answer is that you should wait for the rate cycle to turn, I will say so. The migration numbers will still be there.