Where to Stay in Melbourne: Best Neighborhoods & Hotel Picks

How expensive are hotels in Melbourne?

Hotels in Melbourne are not as expensive as you might think. That doesn’t mean Melbourne is a budget destination like Bali or Thailand, but you can find double rooms starting at around 70 euros per night.

At those lower prices, though, you’ll often have to make do with a shared bathroom or very little space.

From about 90 euros per night, you can get good mid-range rooms.

Melbourne also has plenty of hostels with dorm beds. The cheapest beds start at around 20 euros per night.

Our tip: Many hotels don’t include breakfast — but honestly, that’s no big deal. Melbourne is the undisputed capital of great cafés, and you’ll always find a far better breakfast at a local spot than at your hotel.

The best neighborhoods to stay in Melbourne

Melbourne is an incredibly sprawling city. Especially if you’re only here for a short stay, we’d strongly recommend basing yourself in the center. That’s where almost all of Melbourne’s top attractions are — otherwise you’ll burn a lot of time just getting from A to B.

• CBD: Perfect for your first visit to Melbourne or a short stay.
• Docklands: Great if you want to stay in a modern, stylish neighborhood.
• Fitzroy: Melbourne’s ultimate hipster and arts district.
• St. Kilda: Ideal if you want to stay near the beach.

Melbourne’s neighborhoods on a map at a glance

Staying in the CBD (Central Business District)

The CBD is the best place to stay in Melbourne if it’s your first visit and you only have a limited amount of time in the city.

In the Central Business District you’re right in the heart of the action and can reach many Melbourne highlights on foot.

You’ll have an incredible number of restaurants and pubs on your doorstep, and you could spend hours wandering through the street art-filled laneways. There are plenty of shopping options, and afterward you can take a relaxing stroll along the Yarra River.

Public transportation in this area isn’t just plentiful — it’s even free. You only need a ticket if you want to travel outside the CBD.

Advantages of staying in Melbourne CBD:

• Very centrally located and extremely well connected
• Many must-sees are within walking distance
• Tons of shopping options
• Cool laneways packed with street art

Disadvantages of staying in Melbourne CBD:

• Pretty touristy
• Slightly less character than other neighborhoods

Our hotel recommendations for the CBD

The CBD has accommodation in every price range.

A great budget pick is The Village — it offers both affordable double rooms and dorm beds with curtains for a bit of privacy.

For more comfort but still excellent value, check out the Jazz Corner Hotel. The rooms are cozy and many come with a seriously great view over the city.

Staying in the Docklands

The Docklands is your best bet if you want a modern, design-forward neighborhood with plenty of upscale hotels.

The Docklands is a relatively new area that sits right next to the CBD and is especially exciting for fans of modern architecture.

It’s about a 20- to 30-minute walk to the city center. The free City Circle Tram also stops in the Docklands, so getting around is super easy.

From hotel rooms on the upper floors, you’ll get a fantastic view of the harbor and Melbourne’s skyline. The rooms tend to be a bit pricier, but for those views it’s totally worth it.

Advantages of staying in the Docklands:

• Many genuinely beautiful hotels
• Some excellent restaurants nearby
• Great tram and airport connections

Disadvantages of staying in the Docklands:

• The neighborhood isn’t as lively
• A bit farther from the main sights
• Hotels are on the pricier side

Our hotel recommendations for the Docklands

The Quest NewQuay is super stylish and modern. The views from many rooms are fantastic, and the value for money is really impressive.

Every room even has a kitchenette, which is especially handy if you’re traveling with kids.

Staying in Fitzroy

Fitzroy is ideal if you love a hip, creative atmosphere and enjoy going out at night.

Fitzroy borders the CBD and is the laid-back alternative to the city center, well away from the main tourist trail. Here you’ll rub shoulders with artists, creatives, and locals. The streets are lined with small boutiques, galleries, and bookstores.

If you feel like making a night of it, Fitzroy has some really cool bars and clubs to choose from. That does mean things can get loud until around three in the morning in some spots — so check hotel reviews carefully to see whether the surrounding area is noisy.

Even though Fitzroy has a very different vibe from the CBD, it isn’t far from the city center at all. The free tram zone begins at the southwestern edge of Fitzroy.

You can also hop on a tram right on central Brunswick Street — you’ll need a ticket for that. More details are in our Melbourne travel tips.

Advantages of staying in Fitzroy:

• Tons of cool restaurants, bars, and street art
• You’ll mix with locals rather than tourists
• Just a short trip from the city center

Disadvantages of staying in Fitzroy:

• Farther from some of the main attractions
• The neighborhood is a little rough around the edges

Our hotel recommendations for Fitzroy

The lyf Collingwood is technically in the neighboring Collingwood — but it’s right on Fitzroy’s doorstep and absolutely incredible. The rooms are cool and creatively designed with great amenities, the staff is super friendly, and there’s even a free bike rental.

Staying in St. Kilda

A hotel in St. Kilda is perfect if you’re spending a bit more time in Melbourne and want to stay near the beach, away from the city buzz.

If you’re after lodging by the beach, St. Kilda is the area to look at. The beaches aren’t the most stunning in Australia, but having the ocean right outside your door is still pretty great.

St. Kilda sits a little outside Melbourne’s city center and offers not only the beach but also plenty of restaurants and cafés. Along the beachfront promenade you’ll find some lovely spots for coffee, ice cream, or dinner with a sea view.

By tram, you’re at Federation Square in the CBD in about 20 minutes.

Advantages of staying in St. Kilda:

• Right on the beach
• Lots of restaurants and cafés
• Great for families
• Good tram connections to the city center

Disadvantages of staying in St. Kilda:

• Longer journey to the city center and main sights
• The beach isn’t the most beautiful

Our hotel recommendations for St. Kilda

The Prince is just a five-minute walk from the beach and decorated in lovely pastel tones. The hotel has a restaurant and a great café, and free parking is available too.