Cranbourne South has taken the top spot in Melbourne’s list of most attractive suburbs for property investors this spring, according to the latest PropTrack Investor Report by Terri Scheer.
Key Takeaways
- Cranbourne South is Melbourne’s top investment suburb for houses in 2025.
- Melbourne property investors are returning, making up one in three new loans.
- Suburbs with high rental yields and strong growth dominate the list.
- Investors are competing directly with first-home buyers under the expanded Home Guarantee Scheme.
- Top unit suburbs like Notting Hill and Sunshine offer yields up to 6.9%.
Property Investors Return to Melbourne’s Market
Property investors have made a strong comeback in Victoria this year, accounting for one in three loans so far in 2025.
This resurgence is being driven by:
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Tight rental markets, creating strong demand and attractive returns.
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Falling interest rates, improving borrowing conditions.
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A market rebound, with Melbourne recently returning to peak house prices.
However, investors are being urged to choose wisely, as the report also found 16% of Victorian property investors sold at a loss in the past year.
“It was only in the past month that Melbourne returned to peak prices, so those who bought before 2022 have had that risk of selling for losses,” said REA Group senior economist Angus Moore.
Melbourne’s Top 10 Suburbs for Investment Houses
The suburbs below recorded above-average rental returns and annual median price growth over 9.5%, making them Melbourne’s best-performing house markets this spring.
| Suburb | Median Price | Annual Median Growth | Rental Yield |
|---|---|---|---|
| Cranbourne South | $800,000 | 9.5% | 4.3% |
| Meadow Heights | $638,000 | 10% | 4.5% |
| Coolaroo | $602,000 | 11.4% | 4.3% |
| Dallas | $570,000 | 6.5% | 4.5% |
| Westmeadows | $700,000 | 6.5% | 4.4% |
| Melton West | $571,000 | 8.8% | 4.2% |
| Lynbrook | $845,000 | 12.3% | 4.1% |
| Carrum Downs | $740,000 | 6.5% | 4.2% |
| Frankston | $646,000 | 9.5% | 4.1% |
| North Burnside | $800,000 | 12.5% | 3.9% |
Melbourne’s Top 10 Suburbs for Investment Units
Unit markets also remain strong, particularly in affordable outer suburbs with solid yields above 5%.
| Suburb | Median Price | Annual Median Growth | Rental Yield |
|---|---|---|---|
| Notting Hill | $384,000 | 10.9% | 6.9% |
| Sunshine | $516,000 | 12.2% | 6% |
| Broadmeadows | $465,000 | 11.8% | 5.7% |
| Cremorne | $600,000 | 5.3% | 6% |
| Fawkner | $590,000 | 9.9% | 5% |
| Maribyrnong | $480,000 | 5.5% | 6.1% |
| Meadow Heights | $498,000 | 10.6% | 5.3% |
| South Yarra | $570,000 | 5.3% | 6.1% |
| Bundoora | $460,000 | 5.7% | 5.7% |
| Coburg | $585,000 | 6.8% | 5.1% |
Market Outlook
With further interest rate cuts likely and strong rental demand continuing, Melbourne’s property market is expected to remain buoyant into summer.
Affordable outer suburbs are drawing both first-home buyers and investors, increasing competition but also signalling sustained confidence in Victoria’s housing sector.
