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Melbourne’s spring 2026 market: tough for buyers and sellers, but in very different ways
Spring is here, and so is the reality of what Melbourne’s property market looks like heading into the busiest period of the year. You don’t need to be a property expert to know things are flat. The numbers confirm it.
But the common assumption – that a buyer’s market is easy for buyers and hard for sellers – only tells half the story.
Buyers have the pricing advantage right now. What they don’t have is choice. Sellers face thin demand. But discretionary vendors aren’t playing at all. The result is a market that’s tough for everyone, just in different ways.
The numbers behind the spring market
The data from August through mid-September paints a stark picture when compared to the same period last year.
Average clearance rates have dropped from around 68 per cent last spring to approximately 58 per cent now. In some areas, the reduction has been as much as 15 per cent. And those clearance rate figures include properties that pass in and sell post-auction. Strip that back to what actually sells under the hammer – typically an indicator of genuine multi-party competition – and the figure is probably closer to 30 per cent.
Auction volumes tell the other side of the story. Over that same seven-week period, auction numbers are down 35 per cent year-on-year. The second weekend in September last year saw over 1,200 auctions. The equivalent weekend this year had just over 700.
Days on market are climbing too. The median selling time in August last year was around 30 days. This year it’s at 43 and still rising. It could well reach 50 or more by the end of the year.
What buyers need to understand right now
This is the market every buyer says they want to buy in. Limited competition. Room to negotiate. Prices going backwards. In theory, ideal conditions.
The problem is supply. Discretionary vendors are not choosing to sell in this climate. As a result, property choice is dramatically reduced. The opportunities are real – but the right property may take considerably longer to find. Patience is essential. And when you do find the right one, don’t overplay your hand. If you can get close on price, do the deal. The alternative may not come along for months.
First home buyers vs premium upgraders
The market is playing out very differently at each end. First home buyers remain the most active segment. Competition isn’t fierce, but there are bidders present – you’re more likely to encounter one or two other parties than to have the property entirely to yourself.
At the premium end – roughly $5 million and above – and for upgraders more broadly, the market has been hit hardest in terms of value. But supply in this space is even thinner, and a growing proportion of transactions are happening off-market. Vendors who don’t need to sell are happy to test the market quietly. If they get their price, they’ll transact. If not, they walk away without having spent a dollar on advertising or preparation.
For buyers, that means staying close to agents with strong local databases. Off-market opportunities are where the value is – but be careful. Vendors in this space often have no urgency. The absence of pressure means you can end up paying a premium if you’re not disciplined about value.
What sellers need to consider
Are you choosing to sell or do you need to sell?
This is the first question to answer honestly.
Investors frustrated by costs and flat growth but not under financial pressure are probably better off holding until conditions improve.
Owners of lifestyle properties – a beach house on the Mornington Peninsula that’s not getting much use – might consider leasing for a year or two rather than selling into a weak peninsula market where supply is already heavy.
But if you’re an upsizer who needs to sell to fund the next purchase, or a retiree looking to release equity, that’s a genuine need. Different considerations apply.
Identify your likely buyer and present accordingly
If you do need to sell, everything flows from understanding who your buyer is.
First home buyers want turnkey – styled, presented, ready to move into.
Developers don’t care about improvements, so don’t spend money on a house that’s likely to be demolished.
Upsizers and downsizers generally want something they can move into comfortably, even if they plan to personalise it over time.
Match your presentation, your spending and your marketing to the buyer you’re targeting. Don’t invest based on instinct – invest based on who’s most likely to walk through the door.
Method of sale and timing
Auction has been the default for established inner and middle-ring property in Melbourne for years. In the current market, that’s worth reconsidering.
Private sale and expressions of interest give vendors more control over the narrative. They allow conditional offers. And they remove the transparency that can work against you when buyer depth is thin.
Off-market is another option – particularly as a way to test the market before committing to a full campaign. But the success of that approach depends heavily on your agent’s local market share and database strength. When the campaign relies on contacts rather than advertising, the agent’s network is everything.
On timing, consider whether the current window suits your property type, your personal circumstances, and whether the market is likely to soften further or stabilise. There’s no one-size-fits-all answer. Each decision needs to be assessed on its own merits.
ON GROUND CASE STUDY
When Being Too Cute Costs You $20,000+
We recently assisted a vendor selling an investment property as part of a retirement strategy – a need to sell, not a choice. The property was well-prepared for first home buyers: styled, freshly painted and carpeted, ready to move into.
The campaign generated solid interest. Three parties were engaged. One was ready to bid. One liked the property but didn’t have finance sorted in time. A third had been in contact but went quiet in the final week.
On auction day, the ready buyer bid at below the bottom of the quoted range. The property passed in. They came up to the bottom of the range and stopped – confident there was no one else serious, and sceptical of the agent’s assurance that other parties were interested.
Over the following week, the picture changed. The finance buyer got approval and completed due diligence. The quiet buyer resurfaced. By the end of the week, we had a highest-and-best scenario. The original buyer – the one who refused to budge on auction day – ended up purchasing the property above the top of the quoted range. Roughly $20,000 more than they likely would have paid had they negotiated reasonably when they had the chance.
The lesson cuts both ways. The vendor got a strong result by being well-prepared and patient. The buyer paid a premium by assuming they could dictate terms in a market that felt softer than it actually was for that property.
Take home message
Melbourne’s spring market is undeniably tough. The data confirms it. But tough looks different depending on which side of the transaction you’re on.
For buyers, the pricing is favourable but the choice is thin. Show patience. Stay close to agents. And when the right property presents itself, negotiate hard but don’t be reckless – the next opportunity may be a long time coming.
For sellers, be honest about whether this is a choice or a need. If it’s a choice, consider waiting. If it’s a need, identify your buyer, present accordingly, and choose a method of sale that gives you control in a market where buyer depth is limited.
The market will turn. It always does. The question is whether you’re making the right decisions for your circumstances in the meantime.
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