Australia’s second largest city, Melbourne, is packed with action and adventure. It has a rich history and diverse culture and boasts an eclectic food scene, vibrant street art and energetic nightlife.
In short, Melbourne is a gem city for travellers of all ages, styles and budgets.
But Melbourne is a massive city and figuring out which area to stay in can be overwhelming. That’s why I wrote this epic guide for where to stay in Melbourne.
This Broke Backpacker’s Guide is designed with one thing in mind – to help YOU find the best neighbourhood to stay in Melbourne based on what YOU want to do. So whether you’re looking to party, eat or explore the streets, this Melbourne neighbourhood guide will help you find the hotel or hostel of your dreams.
Let’s get right to it. Here are our top picks for where to stay in Melbourne, Victoria, Australia.
Looking for a specific place to stay? These are our highest recommendations for places to stay in Melbourne.
For all the broke backpackers, we’d recommend checking out Melbourne’s coolest hostels. They’re affordable, offer a lot of bang for your buck and you’ll be able to meet like-minded travellers from all over the world without even leaving your new home! There are heaps of other options too including budget hotels as well as luxury hotels for those with some cash to splash!
Unlock Our GREATEST Travel Secrets!
Sign up for our newsletter and get the best travel tips delivered right to your inbox.
Best Hostel in Melbourne: The Nunnery
A top cheap hostel in Melbourne for solo travellers, couples, and groups of friends, the charming Nunnery has a wide selection of private and shared sleeping spaces housed in a historic building that’s bursting with character. Situated in trendy Fitzroy, the hostel goes all out when it comes to fun and free experiences, from the Sunday pancake breakfast and the BBQ nights on Fridays to chilled movie nights and lively pub crawls, there are heaps to suit all tastes. This hostel blows many of the cheap hotels out of the water tbh.
Best Hotel in Melbourne: Ovolo Laneways
This is the best hotel in Melbourne because of its great location, modern rooms and comfortable beds. Located in the CBD, this four-star hotel is a short walk from theatres, museums, eateries, boutiques and bars. It has 43 refurbished rooms, free wifi and a stunning rooftop terrace.
Best Airbnb in Melbourne: Perfectly located Apartment with City Views
Nestled just minutes away from the CBD, this fully equipped and furnished apartment unit is ideal for those travelling to Melbourne on a budget. All the basic amenities are provided, from A/C and heating, bathroom essentials to kitchen equipment. There’s a Woolworths supermarket in the building near the entrance.
Perfectly located Apartment with City Views is one of our favourites in Melbourne but they’re not taking guests right now. We’re not sure if they’re closed for good but we hope they’ll come back soon.
CBD
The CBD is the centre of Melbourne. It’s the neighbourhood at the heart of the action and is home to Melbourne’s most famous and renowned sights, which is why the CBD is the best area in Melbourne to stay in for sightseeing and exploring.
South Melbourne
South Melbourne is an inner-city suburb that sits nestled between the Yarra River and Port Phillip Bay. It is a charming and eclectic neighbourhood that is home to Victorian-era terrace homes and one of the oldest public markets in Melbourne.
Fitzroy
Fitzroy is one of the coolest neighbourhoods in Melbourne. It is situated northeast of the CBD and has long drawn hipsters, trendsetters, artists and creatives thanks to its many bookstores, galleries, independent boutiques and eclectic eateries.
Richmond
Richmond is a cool inner city suburb located not far from the CBD. It was once a run-down district that underwent a significant period of redevelopment in the 1990s. Today, Richmond is one of the most popular and sought-after neighbourhoods in the city.
St Kilda
St Kilda is a historic suburb located in south-eastern Melbourne. It’s our number one choice for where to stay in Melbourne for families because it offers excellent access to beaches and the city, and there are plenty of seaside activities to enjoy.
Melbourne is a massive and sprawling city and a dream-come-true for backpackers.
It is located at the head of Port Phillip Bay on Australia’s southern coast and is the largest city and capital of the state of Victoria.
The city is considered Australia’s capital of culture thanks to its stunning architecture, cosy cafes, energetic bars and restaurants, and its myriad of museums, art galleries, parks and theatres. Melbourne also plays host to the Australian Open tennis tournament and the Formula 1 Grand Prix, which add to its already fun and exciting image.
Home to a population of more than 3.5 million people, Melbourne is divided into numerous diverse neighbourhoods and distinct suburbs. You can hop on a walking tour of Melbourne to see all the best bits.
This guide will explore the five best places in Melbourne to stay based on interest and budget.
At the heart of the city is the Central Business District (CBD). This lively and bustling district is home to the city’s most famous landmarks and is one of the best places to stay in Melbourne for sightseeing, dining and exploring. There are so many things to see here that you won’t be able to fit everything in.
Travel northeast from here and you’ll arrive in Fitzroy. One of the coolest and most colourful neighbourhoods in town, Fitzroy is our number one pick for where to stay in Melbourne for nightlife because it has many bars, clubs, restaurants and shops to choose from.
Set south of Fitzroy is Richmond. A hip inner suburb, Richmond is known for its delicious restaurants, lively bars and is one of the coolest places to stay in Melbourne. It also borders the South Yarra area too where the famous Chapel Street is located.
South Melbourne is an eclectic neighbourhood situated south of the CBD. It offers picture-perfect views of the city centre and is home to one of the oldest markets in Melbourne. This is also our choice for where to stay in Melbourne for one night because it has so many excellent hostels and budget hotels.
And finally, St Kilda is a charming suburb located southeast of the CBD. It has a rich and varied history and boasts some of the best beaches in the city, which is why it wins our vote for where to stay in Melbourne with kids. There’s also the historic Luna Park which is a fun day out.
Melbourne’s 5 Best Neighbourhoods to Stay in
Still not sure which is the best neighbourhood in Melbourne to stay in? Don’t worry, we’ve got you covered! If you’re in Melbourne for a weekend or a short visit, knowing where to stay can make your whole trip a lot more enjoyable – and save your feet a lot of walking!
#1 CBD – Where to Stay in Melbourne for Your First Time
The CBD is the centre of Melbourne. It’s the neighbourhood at the heart of the action and is home to Melbourne’s most famous and renowned sights, which is why the CBD is the best area in Melbourne to stay in for sightseeing and exploring. Right across from the Yarra River is the famous Flinders Street Station where you can explore the rest of the city from.
The neighbourhood is also well-known for its sprawling laneways with colourful graffiti and street art. Here you can enjoy a stimulating and fun day wandering the streets and eyeing all the incredible artwork.
The Melbourne CBD is also a great place to eat and drink because it has so many unique, lively and delightful bars, pubs, restaurants and cafes. It’s the best place to go if you’ve just completed your Sydney to Melbourne road trip or arrived at Southern Cross Station to explore Melbourne, Australia.
Being so central there’s a large collection of Melbourne hotels in this area too, from cheap hotels to boutique hotel options.
Things to See and Do in CBD
- Admire the architecture of the iconic Flinders Street Station.
- Be amazed by the design of the Princess Theatre.
- Browse the historic Queen Victoria Market.
- Grab a snack and explore Chinatown.
- See your favourite fish and aquatic animals at SEA LIFE Aquarium Melbourne.
- Stand at the centre of Melbourne in Federation Square.
- Step back in time at the Old Melbourne Gaol.
- Stop and smell the roses at the Royal Botanic Gardens Victoria.
- Take a cruise along the Yarra River.
- Visit the National Gallery of Victoria, the oldest gallery in Australia.
Best Hostel in CBD: The Village Melbourne
Set on the edge of the Central Business District, The Village Melbourne provides you with a prime city location and great facilities. Situated close to the hippest cafes, bars, and other central activities, staying at The Village Melbourne is a great choice. Explore the street art, stroll down the Yarra River, marvel at Flinders Street Station or hit the shops on Collins Street, it’s all a short walk away.
It’s really convenient and easy to hop into the heart of Melbourne from here. Besides location, The Village Melbourne offers a new re-design that has every backpacker amenity you’re looking for.
Best Hotel in Melbourne CBD: Ovolo Laneways
This is the best hotel in Melbourne because of its central location, modern rooms and comfortable beds. Located in the Melbourne CBD, this four-star hotel is a short walk from theatres, museums, eateries, boutiques and bars. It has 43 refurbished rooms, free wifi and a stunning rooftop terrace. If you’re looking for luxury hotels in Melbourne, Australia then look no further. Be sure to check out the beautiful Royal Botanic Gardens that are just a short walk away too.
Best Hotel in CBD: Alto Hotel on Bourke
The Alto Hotel on Bourke is set at the centre of the Melbourne CBD. It provides stylish and comfortable rooms that are within close proximity to the city’s top attractions and landmarks. There’s also plenty of restaurants, shops and bars nearby. This hotel has great features, like free wifi and air conditioning, and it serves a delicious breakfast. It’s one of the best Melbourne hotels for location.
Best Airbnb in CBD: Perfectly located Apartment with City Views
Nestled just minutes away from the CBD, this fully equipped and furnished Australian Airbnb unit is ideal for those travelling to Melbourne, Australia on a budget. All the basic amenities are provided, from A/C and heating, bathroom essentials to kitchen equipment. There’s a Woolworths supermarket in the building near the entrance and it’s ideally located for visiting Queen Victoria Market, the Royal Botanic Gardens and generally exploring the Melbourne CBD.
Perfectly located Apartment with City Views is one of our favourites in Melbourne but they’re not taking guests right now. We’re not sure if they’re closed for good but we hope they’ll come back soon.
We’ve tested countless packs over the years, and now we’ve found our absolute favourite: the nomad-approved Nomatic Travel Bag.
Want more deetz on why we love it so damn much? Then read our comprehensive review for the inside scoop!
Learn More Now!#2 South Melbourne – Where to Stay in Melbourne on a Budget
South Melbourne is an inner-city suburb that sits nestled between the Yarra River and Port Phillip Bay. It is a charming and eclectic neighbourhood that is home to Victorian-era terrace homes and one of the oldest public markets in Melbourne. This diverse south-central district is one of the best areas in Melbourne to stay for spectacular and panoramic views of the city’s skyline and is a gateway to the best road trips in Victoria.
Home to a number of backpacker hostels and affordable hotels, South Melbourne is our top pick for where to stay in Melbourne for one night – or if you’re on a budget. Throughout the neighbourhood, you’ll find an array of Melbourne accommodation options that offer comfortable, clean and safe beds at a great price.
Things to See and Do in South Melbourne
- Admire the grand South Melbourne Town Hall.
- Catch a performance at the world-class Arts Centre Melbourne.
- Dig into a tasty plate of fish and chips at Hunky Dory.
- Eat delicious Asian dishes at Penang Road.
- Enjoy a sweet treat from Agathe Patisserie.
- Excite your tastebuds at Ponyfish Island Cafe.
- Relax in Foundry Site Park.
- Sip a cappuccino at Dimattina Café.
- Snack and shop your way through the South Melbourne Market.
- Start your day with breakfast at Cottle on Coventry.
- Take in the views from the Eureka Skydeck.
Best Airbnb in South Melbourne: Modern Apartment in Prime Location
This stylish living space is fitted with two queen size beds and can accommodate up to six guests. Its spacious and comfortable living room comes with free Netflix and the kitchen comes with an espresso machine. Enjoy the city views as you start your day drinking your coffee, then explore the city including the Emporium Shopping Centre, Bourke Street Mall, China Town, only a minutes walk away. We’d even go as far and say that this is one of the best Airbnbs in Melbourne.
Best Hotel in South Melbourne: Seasons Botanic Gardens
Seasons Botanic Gardens is one of the best places to stay in Melbourne if you’re on a budget because it has a great location and comfortable rooms – all for an affordable price. Each apartment has air conditioning and comes complete with modern amenities. You’ll find loads of boutiques, bars and bistros nearby.
Best Hostel in South Melbourne: Market Tavern
This is the best hostel in Melbourne. It is located at the centre of the neighbourhood and the iconic South Melbourne Market is just across the street. They offer a variety of dorm rooms, free linens and wifi, and have great communal facilities. This hostel also hosts free meal nights on Wednesdays.
Market Tavern is one of our favourites in Melbourne but they’re not taking guests right now. We’re not sure if they’re closed for good but we hope they’ll come back soon.
Best Hotel in South Melbourne: Clarendon Hotel Melbourne
This hotel is located in one of Melbourne’s best neighbourhoods. This boutique hotel is close to excellent tourist attractions, bars, restaurants and shops. Comprised of 12 rooms, this charming hotel offers free wifi and a laundry service. There’s also a great on-site restaurant.
Clarendon Hotel Melbourne is one of our favourites in Melbourne but they’re not taking guests right now. We’re not sure if they’re closed for good but we hope they’ll come back soon.
Wonder how to spend your trip in Melbourne? Head over to our insider Melbourne itinerary guide!
#3 Fitzroy – Where to Stay in Melbourne for Nightlife
Fitzroy is one of the coolest neighbourhoods in Melbourne. It is situated northeast of the CBD and has long drawn hipsters, trendsetters, artists and creatives thanks to its many bookstores, galleries, independent boutiques and eclectic eateries.
If you’re looking to enjoy the nightlife scene, this is the best neighbourhood to stay in Melbourne, Australia. This hip and bohemian ‘hood is home to a wide range of bars, clubs and restaurants. So, whether you want to dance the night away, sip a succulent glass of wine, or indulge in a mouthwatering meal, the Fitzroy neighbourhood has exactly what you’re looking for – and more!
Things to See and Do in Fitzroy
- Dance the night away at The Night Cat.
- Drink Bloody Mary’s at Upside Rooftop Bar.
- Eat, drink and enjoy the view at Naked for Satan.
- Feast on excellent pub food at Builders Arms Hotel.
- Grab a pint at the iconic Workers Club.
- Head to Polly Bar for happy hour drinks.
- Indulge in tasty snacks at Bimbo Deluxe.
- Sip elegant cocktails at The Everleigh.
- Tease your taste buds at The Kodiak Club.
- Try excellent Aussie fare at Culter & Co.
Best Hostel in Fitzroy: The Nunnery
A top hostel in Melbourne for solo travellers, couples, and groups of friends, the charming Nunnery has a wide selection of private and shared sleeping spaces housed in a historic building that’s bursting with character. Situated in trendy Fitzroy, the hostel goes all out when it comes to fun and free experiences, from the Sunday pancake breakfast and the BBQ nights on Fridays to chilled movie nights and lively pub crawls, there’s heaps to suit all tastes.
Best Apartments in Fitzroy: Tyrian Serviced Apartments Fitzroy
These apartments are ideally located in one of Melbourne’s best neighbourhoods. They’re within walking distance of awesome attractions, eclectic restaurants, vibrant bars and local shops. Each luxurious apartment comes complete with free wifi, air conditioning, a terrace and modern amenities.
Best Hotel in Fitzroy: District Fitzroy
Perfectly located for shopping, dining, clubbing and exploring, this is one of our favourite properties in Melbourne. Each comfortable apartment is well-equipped with air conditioning, a kitchenette and an in-room dining area. There’s also private parking, on-site laundry services, and free wifi.
Best Airbnb in Fitzroy: Charming and Artsy House in Fitzroy
This recently renovated 80-year-old Victorian-style terrace house represents the essence of Melbourne. Just off the popular Brunswick Street, walk down and explore the lively and trendy neighbourhood, and come home to a clean and fresh place. This house has a private outdoor area so you can enjoy the sun, too.
Charming and Artsy House in Fitzroy is one of our favourites in Melbourne but they’re not taking guests right now. We’re not sure if they’re closed for good but we hope they’ll come back soon.
A new country, a new contract, a new piece of plastic – booooring. Instead, buy an eSIM!
An eSIM works just like an app: you buy it, you download it, and BOOM! You’re connected. It’s just that easy.
Is your phone eSIM ready? Read about how e-Sims work or click below to see one of the top eSIM providers on the market and ditch the plastic.
Buy an eSIM!#4 Richmond – Coolest Place to Stay in Melbourne
Richmond is a cool inner-city suburb located not far from the CBD in East Melbourne. It was once a run-down district that underwent a significant period of redevelopment in the 1990s. Today, Richmond is one of the most popular and sought-after neighbourhoods in the city.
Excellent shopping, enlightening entertainment, a myriad of mouthwatering restaurants, and hip local breweries are just a few of the things that make Richmond our pick for one of the coolest places to stay in Melbourne.
Richmond is also home to the famous Melbourne Cricket Ground, a popular destination for sports fans from around the world and the home of AFL (Aussie rules footy).
So whether you’re looking to shop ‘til you drop, tease your taste buds or take in a match, Richmond is a neighbourhood with so much to offer visitors.
Things to See and Do in Richmond
- Catch a performance at The Owl and Cat Theatre.
- Dine on fresh and delicious seafood at Richmond Oyster Bar.
- Eat exquisite sushi and Japanese food at Minamishima.
- Enjoy a delicious and filling meal at Friends of Mine.
- Excite your senses at Noir.
- Grab a pint at Burnley Brewing.
- Savour a flavourful bowl of soup at Pho Hung Vuong.
- Sip drinks and snack on Aussie fare at the buzzing Corner Hotel.
- Tour the Mountain Goat Brewery.
- Visit Moon Dog Craft Brewery, one of Australia’s most exciting breweries.
- Head to neighbouring South Yarra and eat some of the best food in town on Chapel Street.
Best Hostel in Richmond: Central Melbourne Accommodation
This hostel is one of the best places in East Melbourne to stay for hipsters, trendsetters and cool kids. It’s located at the heart of Richmond and is just minutes from great shopping, dining and nightlife options. This boutique hostel has 30 rooms, modern amenities, laundry, wifi and more.
Best Hotel in Richmond: Amora Hotel Riverwalk
The Amora Hotel is just steps from Melbourne’s hottest hood. Rooms are modern and comfortable and each comes complete with a private bathroom, air conditioning and a TV. This stylish hotel also has free bicycle rentals, a coffee bar, and a delicious breakfast menu.
Best Hotel in Richmond: Adara Richmond
This 4.5-star hotel is an excellent Melbourne accommodation option if you’re looking for luxury hotels. It is conveniently located in Richmond, the city’s coolest neighbourhood, and is close to shops, bars, cafes and eateries. Comprised of contemporary apartments, this hotel provides a great home away from home in Melbourne, Australia.
Best Airbnb in Richmond: Perfectly Nestled Town House in Richmond
Located minutes away from the best Melbourne has to offer, this charming townhouse is fully equipped and offers extra touches which will make you feel at home. The bathrooms come with all basic essentials, from a hairdryer, shower gel to moisturiser. The kitchen is equipped with plenty of cooking utensils in case you want to self-cater. It’s a short walk to South Yarra and Chapel Street too.
Perfectly Nestled Town House in Richmond is one of our favourites in Melbourne but they’re not taking guests right now. We’re not sure if they’re closed for good but we hope they’ll come back soon.
#5 St Kilda – Where to Stay in Melbourne for Families
St Kilda is a historic suburb located in south-eastern Melbourne. It’s our number one choice for where to stay in Melbourne for families because it offers excellent access to beaches and the city, and there are plenty of seaside activities to enjoy. So whether want a relaxing vacation or to take in the sights, St Kilda is an excellent base for you and your family. There’s also plenty more budget hotels here than the Melbourne CBD.
Love to eat? St Kilda is also packed with delicious, innovative and eclectic restaurants, bars and cafes that will appeal to all palettes. From contemporary Aussie fare to Asian fusion and far-out flavours, St Kilda is a neighbourhood that will excite your senses and satisfy your appetites.
Things to See and Do in St Kilda
- Dig in at Rosco’s at Chevron Café Bar.
- Dine on tasty Chinese and Asian dishes at Lau’s Family Kitchen.
- Eat fresh and delicious seafood at Claypots Seafood Bar.
- Fill up on Aussie food at The Local Taphouse.
- Go for a stroll along the St Kilda Pier.
- Indulge in a delicious treat from Le Bon Continental Cake Shop.
- Kickstart your day with a filling and delicious breakfast at Galleon Café.
- Lounge on the sand at St Kilda Beach.
- Spend a fun and exciting day at Luna Park.
- Wander through the lush St Kilda Botanical Gardens.
Best Hostel in St Kilda: Base St Kilda
This hostel offers quality rooms, stylish décor and friendly service – all for an affordable price. They provide free wifi, free activities and free pancakes. This hostel has accommodations for all styles of travellers, including private, double and dorm rooms.
Best Hotel in St Kilda: Quest St Kilda Bayside
The Quest St Kilda Bayside is one of our top choices for where to stay in Melbourne with kids. This four-star hotel is close to the beach and is a short distance from shops and restaurants. Guests can enjoy an outdoor swimming pool, a fitness centre and an on-site BBQ area.
Best Apartments in St Kilda: Adara St Kilda Aparthotel
This 4.5-star property is in the best neighbourhood in Melbourne to stay in for families. It’s within walking distance of St Kilda Beach and lively Luna Park is a short ride away. Each modern apartment has free wifi access and essential amenities. There are even apartments specially designed for families.
Best Airbnb in St Kilda: Two Bedroom Apartment Close to the Beach
This light-filled and peaceful apartment is located only ten minutes away from the popular St Kilda Beach. Fitted with two bedrooms, it can accommodate up to 6 guests, making it perfect for families travelling to Melbourne. Positioned across the road from the Botanic Gardens, it is only a short and convenient stroll to St Kilda centre.
Two Bedroom Apartment Close to the Beach is one of our favourites in Melbourne but they’re not taking guests right now. We’re not sure if they’re closed for good but we hope they’ll come back soon.
FAQ about Finding a Place to Stay in Melbourne
Here’s what people usually ask us about the areas of Melbourne and where to stay.
Don’t Forget Travel Insurance for Melbourne
World Nomads’ mission is to support and encourage travellers to explore their boundaries. They offer simple & flexible travel insurance, and safety advice to help you travel confidently.
They’ve been doing it since 2002 – protecting, connecting, and inspiring independent travellers just like you.
Get a quote below or read our in-depth review!
World Nomads provides travel insurance for travelers in over 100 countries. As an affiliate, we receive a fee when you get a quote from World Nomads using this link. We do not represent World Nomads. This is information only and not a recommendation to buy travel insurance.
Final Thoughts on Where to Stay in Melbourne
Melbourne is an exciting city with so much to offer visitors. From its beautiful beaches and vibrant shopping to eclectic dining and energetic nightlife, there’s plenty to see, do and experience in Australia’s second city.
In this guide, we’ve looked at the best areas to stay in Melbourne. If you’re still not sure which is right for you, here’s a quick recap:
Market Tavern in South Melbourne is our favourite hostel because it has a great location, offers a variety of room styles and it hosts a free meal on Wednesday nights!
Another excellent option is the Ovolo Laneways. Set in the CBD, this is one of the city’s best hotels because it has modern and comfortable rooms, a stunning rooftop terrace, and it’s within walking distance of great entertainment, nightlife, and sightseeing options.
And for transparency’s sake, please know that some of the links in our content are affiliate links. That means that if you book your accommodation, buy your gear, or sort your insurance through our link, we earn a small commission (at no extra cost to you). That said, we only link to the gear we trust and never recommend services we don’t believe are up to scratch. Again, thank you!
