‘Love it out here’: What it costs to live in Melbourne’s top suburbs for wellbeing

The Melbourne suburbs with the highest levels of wellbeing offer access to nature or proximity to the city centre, but moving there will usually cost more than the city’s median house price.

The Melbourne City Council area, Nillumbik shire, Yarra, Port Phillip and the Yarra Ranges local government areas had the highest scores in Victoria in the 2023 Cities and Regions Wellbeing Index by SGS Economics & Planning.

Each region in the report was tracked based on its economy; income and wealth; employment, knowledge and skills; housing; health; equality, community and work-life balance; and environment.

The report does not encompass affordable house prices – the housing indicator looks at whether an area has affordable rentals, and its levels of homelessness and overcrowding. The income and wealth indicator considers house prices as a proxy for household wealth, as higher wealth contributes to wellbeing.

Separate figures from Domain reveal the median house price in the top scoring LGAs: Port Phillip is the highest of the five at $1.73 million, followed by Yarra at $1.4 million, Nillumbik at $1.18 million and Melbourne city at $1,085,000.

Only the Yarra Ranges on Melbourne’s outer eastern fringe and crossing into regional Victoria, at $827,000, is more affordable than Melbourne’s overall median house price, which was $1,032,000 in the March quarter.

SGS Economics & Planning senior associate Michelle Tjondro said the wellbeing index focused on objective factors such as access to healthcare, jobs and education.

It doesn’t measure liveability, which includes subjective factors such as how many of your peer network live nearby.

Tjondro said that even though many people’s wealth was stored in their housing, the report did not conclude that high house prices equalled higher wellbeing.

“It’s certainly not a good thing that it’s very hard for many people to get into the housing market,” she said.

Danielle Blanco moved to Eltham for the open space and greenery.Credit: Eddie Jim

“The messaging that we want to avoid is that it costs more to live in higher wellbeing areas.”

Instead, the report offers a prompt to consider how to make high-wellbeing areas more affordable, such as through improved housing supply, transport connections and investment in infrastructure. And, conversely, how to raise the wellbeing of more affordable areas, such as through policies that encourage more equal gender participation to reduce the gender pay gap, or reduce barriers to workforce participation among communities that have a large migrant profile.

Danielle Blanco, 32, moved to a two-bedroom cottage with a garden in Eltham in Nillumbik shire two years ago from Melbourne’s inner north. She was looking for space and greenery after living in an apartment through lockdown.

She and her partner initially looked at homes for sale in Thornbury, Northcote and Brunswick, but prices beyond their budget prompted them to look further afield.

Danielle Blanco and Daniel Morandin could buy a two-bedroom home with a backyard, once they looked further out of the city.Credit: Eddie Jim

Eltham offered character-filled mid-century style homes, parks and greenery, a farmers’ market and a manageable commute to the city, where she works two days a week in HR and the rest of the week from home.

“It was a really huge contrast to see when we came out here we were a little bit more competitive with our budget,” she said.

“The air just feels fresh, and we feel like we can be outside in our backyard and feel like we’re in nature.”

She still visits friends and family in the inner city at weekends, but also enjoys going for walks in her area and cooking at home.

“I love it out here – we’re just waiting for the good bars to come,” she said.

Ray White Eltham chief auctioneer Sean Salmon said Nillumbik’s green spaces and community feel were a drawcard for buyers moving to the area, along with the parks, sporting clubs and the arts and craft scene.

“[Eltham] is a little hidden pocket in the Diamond Valley and Nillumbik with lots of little restaurants and cafes. It’s got a great community sense about it,” he said.

“You see no shortage of people in Eltham walking, being active, running through the Eltham trails down to Alistair Knox Park.”

Salmon said a typical house in the suburb cost about $1.3 million.

Nelson Alexander Carlton North director Nicholas West said that while property prices in the Yarra area were not cheap – entry-level homes start from $1 million and go much higher – buyers were willing to pay more for the local amenities and village lifestyle.

“A lot of people don’t want to sacrifice the lifestyle … even if they delay the decision to buy so they can live in the area they want to live in and eventually save enough money to buy there,” West said.

West said buyers were drawn to the schools, hospitals, transport, bike lanes, bars and cafes.

“[Lifestyle] is definitely a higher priority than what it was pre-Covid ... being close to parks, outdoors spaces, amenity, where you can walk to places – that all contributes to wellbeing and convenience.”