Long-held homes, disciplined buyers and shrinking supply are quietly reshaping access to Melbourne’s most sought-after suburbs, creating a two-speed market at the top end. Picture: Tony Gough
Melbourne’s most exclusive suburbs are no longer responding to booms or busts, they are being quietly locked away by long-term owners and rate-insulated buyers, creating a two-speed housing market that even a slowing economy can’t unlock.
New analysis from the Kay & Burton Luxury & Lifestyle Market Report 2025 suggests Melbourne’s prestige market is benefiting from global wealth flows and tightening supply, but the underlying driver is structural scarcity rather than renewed frenzy.
In areas such as Stonnington, Boroondara and Bayside, quality homes are rarely traded and often only come to market when life events force a sale, rather than in response to price cycles or interest-rate pressure.
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Kay & Burton Stonnington director Jamie Mi said Melbourne’s most affluent suburbs had proven resilient through decades of market shocks, including the Global Financial Crisis, multiple Reserve Bank tightening cycles and earlier downturns.
“In these elite areas, none of those periods materially affected the very top end,” Ms Mi said.
“That’s why buyers with the right budgets want to secure property in what I’d describe as bulletproof locations.
Kay & Burton director Jamie Mi says Melbourne’s most tightly held suburbs rarely release stock unless life events force a sale.
“They’re buying for long-term resilience, not short-term gains.”
Ms Mi said once homes in these suburbs were tightly held, supply rarely returned unless driven by major life changes.
“Properties only come back to market when something significant happens, children finishing school, families downsizing, or owners moving overseas,” he said.
“They’re not sold lightly, and they’re certainly not sold because the market softens.”
Industry Insider Property director Andrew Date said scarcity was real, but buyers were far more disciplined than in previous cycles.
“There’s very little quality listings available at the higher end, and some of what is coming to market is arguably overpriced,” Mr Date said.
Kay & Burton buyers’ agent Andrew Date says scarcity at the top end is real, but buyers remain disciplined and value-driven.
“In the $2.5m to $6m range in particular, there’s a real lack of well-priced, high-quality homes.”
Mr Date said transaction volumes remained subdued and there was no fear of missing out among buyers.
“They’ll only act if a property genuinely ticks every box,” he said.
“If something is seven or eight out of 10, they’re happy to wait.”
Design and presentation have become key differentiators at the top end, with finished, high-quality homes outperforming as buyers seek certainty amid rising construction costs and unpredictable build timelines.
“There’s a significant portion of buyers who want to pay, turn the key and move straight in,” Mr Date said.
“They don’t want to buy and then spend another $3m to $5m renovating or rebuilding.”
Frame Finance director and principal broker Imogen Alexy says many prestige buyers are insulated from rate rises, shifting focus to quality over urgency.
Frame Finance director and mortgage broker Imogen Alexy said a large share of prestige buyers were insulated from interest-rate movements, allowing them to prioritise quality over urgency.
“A lot of top-end buyers are bringing significant cash deposits to the table, often from generational wealth or years of trading up,” Ms Alexy said.
“These buyers aren’t aggressive, they’re particular. The conversation has shifted away from speed and toward quality.”
Ms Alexy said design-led homes had effectively become irreplaceable assets.
“When buyers can afford to have whatever they want, uniqueness becomes incredibly powerful,” she said.
“If a home offers something that’s difficult or impossible to replicate, it will always be held in higher regard than properties that are interchangeable with their neighbours.”
The consequence is a prestige market increasingly defined by access rather than momentum.
For aspirational buyers, the frustration is not that prices are surging, but that quality homes rarely come up at all.
“In Melbourne’s best suburbs, homes aren’t traded the way people expect,” Ms Alexy said.
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