Whether you have been closely monitoring the Melbourne property market in the recent past, there is one thing that you are certain of: the city is about to have a good year in 2026. As interest rates stabilise, more people are migrating, and with the increased interest in lifestyle-friendly suburbs, investors are returning to Melbourne to explore it as one of the most promising markets to grow.
It doesn’t matter whether you are investing in your first property or investing in another property; the location of the suburb can make or break you.
Top 10 Suburbs to Invest in Melbourne
Here are the following top 10 Melbourne suburbs to invest in for high growth in the year 2026, in terms of demand, rental yield, infrastructure developments, lifestyle and long-term capital growth prospects.
1. Werribee
Werribee keeps on acting as a surprise to investors in terms of its high capital growth and affordability. As it continues to grow, with improved facilities and a location between Melbourne and Geelong, the suburb is enjoying both commuter and family rates.
Why Werribee ranks high:
- Affordable entry price
- Growing infrastructure
- Strong population growth
2. Sunshine
Sunshine has evolved very fast in the past ten years, and now it tends to become one of the key development centres in Melbourne, particularly with the Melbourne Airport Rail Link coming soon.
Key drivers:
- Major transport upgrades
- Expanding commercial activity.
- Strong rental demand
3. Footscray
The west continues to be among the best places in Footscray for attracting young professionals, students and investments as well because it has a multicultural environment, a close location to the central business district, and a burgeoning cafe culture.
Why it’s a 2026 standout:
- Ongoing gentrification
- High rental yields
- Necessary among the young buyers and tenants.
4. Preston
Preston is one of the favourite destinations of investors who wish to be stable over a long period, as it is well-connected by transport and offers lifestyle amenities with high demand. The redevelopment of the suburb is a continuous process and is making it popular.
What makes it a winner:
- Thriving food and arts scene
- Positive record of capital growth.
- Access to trains and trams
5. Coburg
The Coburg has grown into a high-growth suburb due to its combination of old housing, modernisation and transport networks. As the Upfield line upgrade continues, demand continues to increase.
Investment highlights:
- Close to CBD
- Diverse housing options
- Families and professionals are fond of it.
6. Clyde North
Investors who have set their eyes on the south-east of Melbourne, which is developing, cannot ignore Clyde North. It is one of the growing areas in Victoria, as new estates, shopping centres and schools are being erected at a fast rate.
Why it’s booming:
- Large-scale development
- Strong population growth
- High demand for rentals
7. Cranbourne East
The other good place to stay in the south-east is Cranbourne East because it is affordable with good facilities, including schools, sports centres and large shopping centres.
What makes it attractive:
- Low vacancy rates
- Consistent capital growth
- Family-friendly lifestyle
8. Reservoir
Reservoir is a neighbourhood that is becoming popular due to its being well adorned with green streets, renovated houses and improved transport. There is a high prospect of development in the area because of the rising demand for young professionals who cannot afford the inner suburbs.
Reasons to watch:
- Value is high compared to the area around Thornbury and Northcote.
- Strong rental demand
- Ongoing gentrification
9. Tarneit
The Tarneit property markets have become busier due to the young families and first-home buyers, and this has made it one of the busiest property markets in Melbourne. New schools and shopping centres will also be introduced; the transport will be improved in 2026, and it will further propel the suburb.
Investment perks:
- Strong rental yields
- Rapid population growth
- Low prices and high demand for the properties.
10. Brunswick East
Brunswick East is not doing badly regarding inner-city chic. It is among the places that renters and buyers would love because of its fashionable cafes, trams, bike trails, and convenient access to the CBD.
Why it’s investment-ready:
- High rental appeal
- Proven capital growth
- Lifestyle-centric living
Final Thoughts
The property market of Melbourne is emerging as one of the most promising investment hubs in Australia in 2026. The way of life of the inner north, or the development of the south-west, all of the above suburbs have good prospects of both capital development and rental income.
The best investment suburbs, as usual, are in line with your budget, your goals, and your long-term strategy. Local market research, learning about future development, and selecting those areas with a good demand and a definite growth direction.
Explore the best performing suburbs in Melbourne, or you simply need professional advice on the next ideal investment option, Next House will be available to assist you in making the next step with utmost confidence.
