Australia is a massive country. It has six states and two international territories, each with its own favourable qualities. However, two cities stand out in terms of all-around opportunities—Sydney and Melbourne.
Sydney and Melbourne are two major cities in the land Down Under. They are similar yet different—both are highly populated cities, and they offer fantastic job opportunities. Sydney has many popular tourist destinations, including Sydney Harbor, the Sydney Opera House, and Bondi Beach. Melbourne is a city of culture.
Both cities have one thing in common—they are both costly places to live in.
The following factors affect the cost of living:
- Housing
- Food
- Transportation
- Education
- Taxes
Let’s take a look at how Sydney and Melbourne stack up against each other using the following factors:
| Territories | Population | Median home value | Education (13 years) | Transportation
(cost per week) |
| Sydney | 5.3M | $999,278 | $102,807 | $32 – $80 |
| Melbourne | 5M | $746,468 | $89,500 | $31 – $46 |
| National | 25.69M | $702,725 | $87,528 |
Sydney Vs. Melbourne: Housing
Australia has some of the most expensive housing in the world. According to a report, many Australians spend at least 40% of their income on housing. According to the International Monetary Fund, property values are 50% higher than what the average household can afford.
In Sydney, the median home value is close to $1 million, compared to around $750,000 in Melbourne. The national average is just over $700,000.
Sydney is a major metropolis with many opportunities, so housing there is costly. The housing supply cannot keep up with the growing Sydney population, which currently stands at 5.3 million people. This is around 20% of the total Australian population.
Rent in Sydney is also more expensive than in Melbourne, although the latter has a higher inflation rate. Rental costs in Australia increased in the last quarter of 2022 by 1.8% in Sydney and 2.3% in Melbourne. That translates to a weekly rent of $560 in Sydney and $442.5 in Melbourne. The national average is $480 per week.
Sydney Vs. Melbourne: Food
According to the research site Numbeo, consumer prices of goods are 3.5% lower in Melbourne compared to Sydney. To show you the price difference, a litre of milk is only $2.17 in Melbourne compared to $2.28 in Sydney. A loaf of bread costs $3.41 in Melbourne and $3.73 in Sydney.
However, fresh produce, like fruits and vegetables, is more affordable in Sydney. The table shows the price difference among most grocery items:
| Products | Sydney | Melbourne |
| Milk (1 liter) | $2.28 | $2.17 |
| Bread (1 loaf) | $3.73 | $3.41 |
| Eggs (1 dozen) | $5.98 | $5.50 |
| Apples (1 kg) | $4.43 | $4.74 |
| Bananas (1 kg) | $3.65 | $3.78 |
| Tomato (1 kg) | $7.60 | $7.75 |
| Potato (1 kg) | $3.74 | $4.08 |
| Lettuce (1 head) | $4.17 | $5.38 |
Sydney Vs. Melbourne: Transportation
An analysis comparing the possible weekly cost of public transportation in five Australian cities revealed that public transportation in Sydney would purportedly cost $32-$80 in Sydney and $31-$46 in Melbourne.
Sydney residents are the most frequent public transportation users among Australians, with the train being the most popular mode of transportation. However, over 50% of the city’s population owns private cars. In Melbourne, the tram is the most popular form of transportation. The city has the largest urban tram network in the world.
But ever since the pandemic, more Australians have felt comfortable going around in their private cars. Fuel in Sydney costs a little bit more than in Melbourne–$1.70 to $1.73 at the end of 2022.
Sydney Vs. Melbourne: Utilities
Numbeo also crunched the numbers for utilities in a basic apartment for both Sydney and Melbourne. The basic utilities include electricity, cooling and heating, water, and garbage. The average monthly cost in Sydney is $255.08, and $247.74 in Melbourne. However, the internet is more costly in Melbourne, at $81.31 a month, compared to just $79.56 in Sydney. Australia has among the most expensive internet costs in the world.
Sydney Vs. Melbourne: Education
Education is expensive in both Sydney and Melbourne compared to the rest of the country. Sydney is considered the most expensive in terms of private education, and Melbourne takes the cake in public education.
According to a report, it would cost parents $102,807 to send their children to public school over 13 years. The base year is 2023. Compare this to Sydney’s average of just $89,500. The national average is just $87,528 over the same period.
Private education, on the other hand, costs more than three times as much. Sydney has the most expensive private school education, pegged at $357,931 in 13 years. The national average over the same period is just $300,233.
Sydney Vs. Melbourne: Taxes
The average salary of Sydneysiders is $108,000 a year. A Melbournian earns slightly less at $106,000. Sydney and Melbourne have the highest average incomes among major cities. In fact, the national average income is just $90,800 every year.
It’s understandable, given that Sydney and Melbourne have the highest living costs in the country.
The tax is levied based on income. The more you earn, the higher the taxes you pay. No tax is levied on an annual income of $18,200 or less. Between $18,201 and $37,000, the tax is 19%. The rate goes only higher from there: 32.5%, 37%, and 45% for the respective income ranges of $37,001 to $90,000; $90,001 to $180,000; and more than $180,000.
Final Thoughts
According to the World Economic Forum rankings, Sydney, Australia, is the 10th most expensive city in the world. Singapore and New York in the U.S. topped the rankings.
Melbourne isn’t far behind Sydney, sitting in the 15th spot. However, Melbourne was also named Australia’s most livable city and the 10th-most livable city worldwide. Sydney is in the 13th spot.
The cost of living in both Sydney and Melbourne is steep, but in terms of livability, it’s worth it.
If you need more info about other interesting cities in Australia, have a look at these articles: