Knight Frank Residence Report 2026/27
Lessons for Melbourne Investors From the World’s Property Markets
Global luxury trends may seem a long way from a Melbourne investment property. Look closer, and the same principles decide which properties hold their appeal and which don’t.
By Stephen Lazar · properT network
Knight Frank’s Residence Report 2026/27 tracks luxury residential development across 90 countries. Most Melbourne investors aren’t buying branded penthouses, but the report’s central finding applies at every price point.
As more developments offer sophisticated amenities, those amenities stop setting a property apart. What becomes more valuable is what can’t easily be copied: the location, the neighbourhood, and the infrastructure and jobs around it.
For Melbourne investors, that’s a useful way to cut through a crowded market. The question isn’t whether a development has a gym, a pool or a rooftop terrace. It’s whether the property sits somewhere people will keep wanting to live.
You can upgrade a kitchen. You can’t move a train station.
What the Numbers Say About Melbourne
The report includes a snapshot of Australia’s prime (luxury) markets. Melbourne’s figures tell a different story from Queensland’s:
Knight Frank points to planning complexity as one reason luxury development is slower in Melbourne and Sydney than in Brisbane. It also notes that Melbourne already has what Brisbane is still building: international recognition and a deep pool of buyers. GURNER’s redevelopment of the Jam Factory in South Yarra, with around 800 residences, is the city’s most closely watched luxury project.
These are prime-market figures, not benchmarks for typical investment property. A softer luxury market says little about a well-located house and land package in a growth corridor. What it does show is that even at the top end, location and scarcity are doing the heavy lifting.
Features Can Be Copied. Melbourne’s Best Locations Can’t.
Knight Frank calls it “the new scarcity”. As gyms, lounges, concierges and wellness spaces become standard in new developments, value moves to things that can’t be manufactured: place, community and a genuine sense of belonging.
Melbourne investors see a version of this every day. Stone benchtops, landscaping and resident lounges can all help attract tenants. But they can be added to any building, including the one going up next door.
Easy to replicate
- Inclusions and finishes
- Gyms and pools
- Rooftop terraces
- Resident lounges
Hard to replicate
- Proximity to major job hubs
- An established train line
- A sought-after school zone
- A mature, well-serviced suburb
That’s why location remains the foundation of any Melbourne investment property strategy. The building is only part of what a tenant, or a future buyer, is paying for.
Victoria Keeps Growing, Mostly From Overseas
The latest ABS population figures for the year to 31 March 2026 show Victoria is still adding people at a steady pace:
Net overseas migration made up roughly three-quarters of that growth, while net interstate migration was broadly flat at +82. New arrivals typically rent first, which supports rental demand in areas with good transport, jobs and affordability.
That doesn’t mean every suburb benefits equally. Growth concentrates where housing, jobs and services are, and Melbourne’s western, northern and south-eastern growth corridors have absorbed much of it. The investor’s job is to find the specific locations where demand is outpacing new supply.
New Builds: A Convenience Premium, Not a Shortcut
The report finds buyers increasingly value convenience, security and low-maintenance ownership, and it identifies new-build homes as well placed to benefit. Tenants think this way too. Modern layouts, energy efficiency and fewer maintenance problems all count.
For investors, though, “new” is never enough on its own. A new property still has to be in the right location, at the right price, with genuine rental demand and limited competing supply. That’s the lens we apply to every house and land opportunity in Melbourne.
Is this particular new property the right investment, in this particular location, at this particular price? That matters far more than how impressive the display home looks.
Six Questions for Any Melbourne Investment Property
Employment
How close is it to where people actually work?
Transport
Is there an existing train line or major road, not just a proposed one?
Supply
How many similar properties are being built nearby?
Tenants
Who will rent it, and how deep is that demand?
Price
Does the price stack up against real comparable sales?
Exit
Who will buy it from you in ten years, and why?
Read the full analysis
The New Property Premium
This article is the Melbourne view. For the full national picture, including Brisbane’s rise, Queensland’s population story and our investment-grade property checklist, read the complete analysis on properT network.
Want the complete report as a PDF, with the investment-grade property checklist? Download the free guide.
- Knight Frank, The Residence Report 2026/27
- Australian Bureau of Statistics, National, state and territory population, March 2026
- properT network, The New Property Premium: what Knight Frank’s Residence Report means for Australian investors
General information only, not financial, tax or legal advice. Prime-market figures relate to the luxury segment and period stated. Property investment carries risk. Seek independent advice before making any investment decision.