The outlook for property investors in Victoria has been put under the microscope recently. In September 2023, the Property Investment Professionals of Australia adjudged Victoria as the worst of all eight states and territories for property investors after new land taxes were introduced by the Andrews government. This resulted in landlords selling at a record rate in 2024, with rental bond data from the Department of Families, Fairness and Housing revealing more than 20,000 rental properties left Victoria's market.
Victoria remains an enduringly appealing place to live though, with Melbourne frequently ranking very well in lists of the most liveable cities in the world. If you're an investor interested in Australia's second most-populated state, these suburbs and towns have some of the highest rental yields.
Victoria rental yields in 2025
|
Median price |
Median weekly rent |
Median rental yield |
|
|---|---|---|---|
|
Houses (Melbourne) |
$830,000 |
$575 |
3.5% |
|
Units (Melbourne) |
$598,400 |
$550 |
4.7% |
|
Houses (Rest of Victoria) |
$550,000 |
$475 |
4.5% |
|
Units (Rest of Victoria) |
$415,000 |
$395 |
4.9% |
Source: CoreLogic. Data reported to the period ending January '25. Median values account for sales transactions over three months.
Rental yields in Victoria, in both metropolitan and country areas, are comparatively lower than most other regions. Sydney is the only capital city with lower rental yields for houses than Melbourne, while the median yield of 4.7% for units in Melbourne is above only Sydney, level with Hobart.
Part of this is likely due to the Victorian economy, which is more services-based than the likes of WA and Queensland. One of the biggest drivers of high rental yields is the population of transient workers, which is often relatively high in areas where the main industry is mining or agriculture. The high yields in regional Western Australia, for example, are often in resource rich areas, where workers temporarily live during mining projects, driving up rental demand, but without an equivalent demand for owner occupied property.
It's also worth keeping in mind that the land taxes and absentee owner surcharges need to be factored in when considering the overall return from the property. Rental yields might represent some of the property's value, but this could be offset by it being more expensive annually to own an investment property in Victoria compared to elsewhere.
Read more: Top rental yields in Australia
Highest rental yields in Victoria
The suburb with the highest average rental yield for houses in Victoria as of January was Rochester at 8.7%. For units, Melbourne City (3000) took top spot at an average yield of 8.5%.
Houses
| Rank | Suburb (Postcode) | LGA | Median Price | Median Rent | Rental Yield |
|---|---|---|---|---|---|
| 1st | Rochester (3561) | Campaspe | $300,000 | $500 | 8.7% |
| 2nd | Warracknabeal (3393) | Yarriambiack | $197,000 | $315 | 8.3% |
| 3rd | East Bairnsdale (3875) | East Gippsland | $340,000 | $500 | 7.6% |
| 4th | Ouyen (3490) | Mildura | $235,000 | $320 | 7.1% |
| 5th | Dimboola (3414) | Hindmarsh | $260,000 | $350 | 7.0% |
| 6th | Echuca (3564) | Campaspe | $550,000 | $685 | 6.5% |
| 7th | Stawell (3380) | Northern Grampians | $315,000 | $390 | 6.4% |
| 8th | Mooroopna (3629) | Greater Shepparton | $396,250 | $485 | 6.4% |
| 9th | Nhill (3418) | Hindmarsh | $265,000 | $310 | 6.1% |
| 10th | Kalimna (3909) | East Gippsland | $385,000 | $450 | 6.1% |
| 11th | Red Cliffs (3496) | Mildura | $360,000 | $410 | 5.9% |
| 12th | Morwell (3840) | Latrobe (Vic.) | $335,000 | $380 | 5.9% |
| 13th | Lucknow (3875) | East Gippsland | $489,500 | $550 | 5.8% |
| 14th | Merbein (3505) | Mildura | $312,500 | $350 | 5.8% |
| 15th | Cobram (3644) | Moira | $402,500 | $450 | 5.8% |
| 16th | Portland (3305) | Glenelg | $410,000 | $455 | 5.8% |
| 17th | Mortlake (3272) | Moyne | $375,000 | $415 | 5.8% |
| 18th | Heyfield (3858) | Wellington | $337,500 | $370 | 5.7% |
| 19th | Tatura (3616) | Greater Shepparton | $424,500 | $460 | 5.6% |
| 20th | Churchill (3842) | Latrobe (Vic.) | $360,000 | $388 | 5.6% |
| 21st | Beaufort (3373) | Pyrenees | $372,500 | $400 | 5.6% |
| 22nd | Moe (3825) | Latrobe (Vic.) | $357,000 | $380 | 5.5% |
| 23rd | Numurkah (3636) | Moira | $387,500 | $410 | 5.5% |
| 24th | Horsham (3400) | Horsham | $380,000 | $400 | 5.5% |
| 25th | Mildura (3500) | Mildura | $450,000 | $470 | 5.4% |
Source: CoreLogic. Data reported to the period ending January 2025. Median values account for sales transactions over 12 months.
Farming is the major theme of the above list. Rochester, Warracknabeal and Ouyen are all agricultural centres, which can mean higher rental yields as there’s more of a demand for temporary accommodation as workers come and go. There are several other suburbs in this list in the Mildura region, known as the centre of Victoria’s ‘Fruit Bowl’.
Units
| Rank | Suburb (Postcode) | LGA | Median Price | Median Rent | Rental Yield |
|---|---|---|---|---|---|
| 1st | Melbourne (3000) | Melbourne | $400,000 | $650 | 8.5% |
| 2nd | Notting Hill (3168) | Monash | $342,500 | $550 | 8.4% |
| 3rd | Heatherton (3202) | Kingston (Vic.) | $319,000 | $505 | 8.2% |
| 4th | Travancore (3032) | Moonee Valley | $362,000 | $520 | 7.5% |
| 5th | Carlton (3053) | Melbourne | $405,000 | $550 | 7.1% |
| 6th | Southbank (3006) | Melbourne | $500,000 | $675 | 7.0% |
| 7th | Portland (3305) | Glenelg | $300,000 | $385 | 6.7% |
| 8th | West Melbourne (3003) | Melbourne | $480,000 | $600 | 6.5% |
| 9th | Albion (3020) | Brimbank | $297,500 | $370 | 6.5% |
| 10th | Essendon North (3041) | Moonee Valley | $390,500 | $480 | 6.4% |
| 11th | Cairnlea (3023) | Brimbank | $412,300 | $490 | 6.2% |
| 12th | Echuca (3564) | Campaspe | $447,500 | $520 | 6.0% |
| 13th | North Melbourne (3051) | Melbourne | $480,000 | $550 | 6.0% |
| 14th | Abbotsford (3067) | Yarra | $509,500 | $580 | 5.9% |
| 15th | Benalla (3672) | Benalla | $307,500 | $350 | 5.9% |
| 16th | Morwell (3840) | Latrobe (Vic.) | $260,000 | $295 | 5.9% |
| 17th | Jacana (3047) | Hume | $467,000 | $528 | 5.9% |
| 18th | South Melbourne (3205) | Port Phillip | $552,230 | $620 | 5.8% |
| 19th | Traralgon (3844) | Latrobe (Vic.) | $330,000 | $370 | 5.8% |
| 20th | Mildura (3500) | Mildura | $321,500 | $360 | 5.8% |
| 21st | Docklands (3008) | Melbourne | $600,000 | $670 | 5.8% |
| 22nd | Roxburgh Park (3064) | Hume | $430,000 | $480 | 5.8% |
| 23rd | Sale (3850) | Wellington | $327,000 | $365 | 5.8% |
| 24th | Cremorne (3121) | Yarra | $585,000 | $650 | 5.8% |
| 25th | Ararat (3377) | Ararat | $302,500 | $335 | 5.8% |
Source: CoreLogic. Data reported to the period ending January 2025. Median values account for sales transactions over 12 months.
Melbourne City had the highest yields for units in Victoria at 8.5%. Several other suburbs in inner Melbourne made the list, which is slightly unusual given the strongest yields in most other states are generally outside of the capital. What you’ll also notice upon further analysis is this is mostly due to the lower prices of Melbourne units compared to Brisbane and Sydney. It’s not obvious why this is - one contributing factor may be a higher concentration of smaller, one bedroom units in Melbourne compared to other cities.
Highest rental yields in Melbourne
Koo Wee Rup, about 60 kms south-west of the CBD, had the highest rental yields for houses in the Melbourne Statistical Division at 4.9%. For units, Melbourne City was the highest at 8.5%.
Houses
| Rank | Suburb (Postcode) | LGA | Median Price | Median Rent | Rental Yield |
|---|---|---|---|---|---|
| 1st | Koo Wee Rup (3981) | Cardinia | $670,000 | $625 | 4.9% |
| 2nd | Dallas (3047) | Hume | $550,000 | $500 | 4.7% |
| 3rd | Coolaroo (3048) | Hume | $551,000 | $500 | 4.7% |
| 4th | Lang Lang (3984) | Cardinia | $706,500 | $640 | 4.7% |
| 5th | Monbulk (3793) | Yarra Ranges | $808,150 | $720 | 4.6% |
| 6th | Junction Village (3977) | Casey | $655,000 | $580 | 4.6% |
| 7th | Campbellfield (3061) | Hume | $600,000 | $530 | 4.6% |
| 8th | Nar Nar Goon North (3812) | Cardinia | $685,000 | $595 | 4.5% |
| 9th | Melton South (3338) | Melton | $500,000 | $430 | 4.5% |
| 10th | Diggers Rest (3427) | Melton | $605,000 | $520 | 4.5% |
| 11th | Wollert (3750) | Whittlesea | $677,500 | $580 | 4.5% |
| 12th | Melton (3337) | Melton | $470,000 | $400 | 4.4% |
| 13th | Weir Views (3338) | Melton | $545,000 | $460 | 4.4% |
| 14th | Broadmeadows (3047) | Hume | $580,000 | $488 | 4.4% |
| 15th | Craigieburn (3064) | Hume | $655,000 | $550 | 4.4% |
| 16th | Roxburgh Park (3064) | Hume | $655,000 | $550 | 4.4% |
| 17th | Tarneit (3029) | Wyndham | $645,000 | $540 | 4.4% |
| 18th | Pakenham (3810) | Cardinia | $657,000 | $550 | 4.4% |
| 19th | Meadow Heights (3048) | Hume | $600,000 | $500 | 4.3% |
| 20th | Mickleham (3064) | Hume | $660,000 | $550 | 4.3% |
| 21st | Truganina (3029) | Wyndham | $649,900 | $540 | 4.3% |
| 22nd | Yarra Glen (3775) | Yarra Ranges | $870,000 | $723 | 4.3% |
| 23rd | Clyde North (3978) | Casey | $718,000 | $595 | 4.3% |
| 24th | Clyde (3978) | Casey | $700,000 | $580 | 4.3% |
| 25th | Baxter (3911) | Mornington Peninsula | $725,000 | $600 | 4.3% |
Source: CoreLogic. Data reported to the period ending January 2025. Median values account for sales transactions over 12 months.
Units
| Rank | Suburb (Postcode) | LGA | Median Price | Median Rent | Rental Yield |
|---|---|---|---|---|---|
| 1st | Melbourne (3000) | Melbourne | $400,000 | $650 | 8.5% |
| 2nd | Notting Hill (3168) | Monash | $342,500 | $550 | 8.4% |
| 3rd | Heatherton (3202) | Kingston (Vic.) | $319,000 | $505 | 8.2% |
| 4th | Travancore (3032) | Moonee Valley | $362,000 | $520 | 7.5% |
| 5th | Carlton (3053) | Melbourne | $405,000 | $550 | 7.1% |
| 6th | Southbank (3006) | Melbourne | $500,000 | $675 | 7.0% |
| 7th | West Melbourne (3003) | Melbourne | $480,000 | $600 | 6.5% |
| 8th | Albion (3020) | Brimbank | $297,500 | $370 | 6.5% |
| 9th | Essendon North (3041) | Moonee Valley | $390,500 | $480 | 6.4% |
| 10th | Cairnlea (3023) | Brimbank | $412,300 | $490 | 6.2% |
| 11th | North Melbourne (3051) | Melbourne | $480,000 | $550 | 6.0% |
| 12th | Abbotsford (3067) | Yarra | $509,500 | $580 | 5.9% |
| 13th | Jacana (3047) | Hume | $467,000 | $528 | 5.9% |
| 14th | South Melbourne (3205) | Port Phillip | $552,230 | $620 | 5.8% |
| 15th | Docklands (3008) | Melbourne | $600,000 | $670 | 5.8% |
| 16th | Roxburgh Park (3064) | Hume | $430,000 | $480 | 5.8% |
| 17th | Cremorne (3121) | Yarra | $585,000 | $650 | 5.8% |
| 18th | Werribee South (3030) | Wyndham | $410,000 | $450 | 5.7% |
| 19th | South Yarra (3141) | Stonnington | $543,750 | $595 | 5.7% |
| 20th | Craigieburn (3064) | Hume | $422,000 | $460 | 5.7% |
| 21st | Williams Landing (3027) | Wyndham | $442,000 | $480 | 5.6% |
| 22nd | Seddon (3011) | Maribyrnong | $507,000 | $550 | 5.6% |
| 23rd | Flemington (3031) | Moonee Valley | $425,000 | $460 | 5.6% |
| 24th | Broadmeadows (3047) | Hume | $440,000 | $470 | 5.6% |
| 25th | Meadow Heights (3048) | Hume | $450,000 | $480 | 5.5% |
Source: CoreLogic. Data reported to the period ending January 2025. Median values account for sales transactions over 12 months.
Looking for an investment property? Here are some of the top investment home loans available on the Australian market right now
| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Extra Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
5.69% p.a. | 6.03% p.a. | $2,899 | Principal & Interest | Variable | $0 | $530 | 90% |
| Disclosure | |||||||||||
5.74% p.a. | 5.76% p.a. | $2,915 | Principal & Interest | Variable | $0 | $250 | 60% | Disclosure | ||||||||||||
5.69% p.a. | 5.60% p.a. | $2,899 | Principal & Interest | Variable | $0 | $0 | 80% |
| Promoted | Disclosure | ||||||||||
5.84% p.a. | 5.88% p.a. | $2,947 | Principal & Interest | Variable | $0 | $530 | 90% |
| Promoted | Disclosure | ||||||||||
5.74% p.a. | 5.76% p.a. | $2,915 | Principal & Interest | Variable | $0 | $350 | 60% |
First published on March 2024
Image by John Simmons via Unsplash.
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