Trying to decide where to stay in Melbourne? We share the best neighbourhoods and what you need to consider before you book.

Busy, modern, and culturally diverse, Melbourne is the capital of Victoria and offers something for everyone. Whether you’re looking to explore the local culture and food scene or get out of the city to explore the surrounding landscape, Melbourne is the ideal base for your foray into Australia.

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For many travellers, Melbourne is the gateway to the rest of Australia. The bustling streets of its neighbourhoods have a lot to offer visitors when you’re trying to decide where to stay in Melbourne. So let’s take a walk through some of the most popular choices and help you determine what will work best for your vacation.

Melbourne CBD

Melbourne’s CBD – or Central Business District – is close to everything. This is where to stay in Melbourne if you want to be close to the city’s best attractions, as well as restaurants that will delight your tastebuds.

Should you stay in the CBD?

If you have limited time and want to try a little of everything while you’re in the city, then this is one of the best places to stay in Melbourne. It offers attractions like The National Gallery of Victoria and the Crown Casino, as well as Chinatown and sprawling laneways covered with artistic graffiti.

Melbourne city laneway
Hardware Lane in the centre of town

Anything you should consider?

This is obviously the business centre of the city, so it can get a little crowded at times. It also offers more expensive accommodation in Melbourne as well as upper scale restaurants with big price tags.

Our favourite city hotels

Local tip: Wander the laneways in the early morning before the crowds arrive for your own private street art viewing.

South Melbourne

South Melbourne is a charming neighbourhood that’s close to the city and nestled between Port Phillip Bay and the Yarra River. This is a slightly eclectic neighbourhood with a diverse population and stunning views of the city’s skyline.

South Melbourne cafe
The Kettle Black, South Melbourne

Should You Stay in South Melbourne?

If you’re trying to decide where to stay in Melbourne and like a bit of character with your travel, then South Melbourne fits the bill perfectly. It has everything from amazing views to Victorian-era terrace houses and is one of the oldest markets in the city. South Melbourne is filled with unexpected treasures and offers cheaper options for accommodation in Melbourne.

Anything you need to know?

There really aren’t too many cons to staying in South Melbourne; it’s fairly safe and one of the most interesting places to stay in Melbourne.

Our favourite South Melbourne hotels

  • Coppersmith Hotel – Once a hotel now a 15 room boutique hotel, close to all the sports action if you are planning to watch a game.
  • Ink Hotel Melbourne – Ok so it’s Southbank but we love it and its right on the doorstep of South Melb.

Local tip: Be sure to pop into South Melbourne Market, it’s open Wednesday & Friday- Sunday – there is plenty to love but be sure not to miss the deliciousness on offer at Cannoleria stall.

North Melbourne

North Melbourne is about ten minutes by car from the CBD and has a more family-oriented feel. This makes it one of the best places to stay in Melbourne if you’re travelling with kids. 

Should You Stay in North Melbourne?

North Melbourne is an edgy art area with a touch of class that still flies mostly under the radar when it comes to outside travellers. This is one of the best places in Melbourne for edgy art spaces, cool bars, and cafes, and a community that feels that’s hard to beat.

What you need to know?

There are no cons to staying in this area, so make sure you get there before the crowds do!

Our recommendations for North Melbourne

There are not a lot of hotels in this part of town but the Art Series property – The Larwill Studio is definitely the pick of the bunch. It’s a very cool property and only a short walk from Queen Victoria Market.


Fitzroy is one of the most unapologetically cool places to stay in Melbourne. This neighbourhood is northeast of the CBD (around ten minutes by public transport) and is where the city’s creatives hang out, get their inspiration, and display their wares.

Fitzroy mural
There is always something happening in Fitzroy

Should You Stay in Fitzroy?

If you want to explore the city’s creative heart, then this is where to stay in Melbourne. Fitzroy offers some of the cheapest accommodation in Melbourne, as well as amazing thrift shopping opportunities. And some of the eateries in this area just might be the best and most reasonably priced in the city.

Anything to consider?

Fitzroy is young and hip, but it also has a higher rate of crime, so make sure that you exercise some caution and common sense, particularly at night.

Where to stay in Fitzroy

Local tip: Don’t miss the famous Lune Croissanterie, staying nearby means you can get there earlier enough to beat in usually insane queues.


Carlton is often called “Little Italy”, and it’s a vibrant, ever-changing neighbourhood just six minutes from the city centre by car. It might seem a little shady in places, but the only thing you should be afraid of is how much pizza you’ll end up eating.

Cafe in Carlton near our apartment
Rathdowne Street Carlton

Should You Stay in Carlton?

Carlton has everything. It’s close to the city and carries a touch of European charm that was brought over by the Italian migrants, who settled in the era after the Second World War. Basically, it’s a great choice when you want a touch of international flair and food when you’re trying to decide where to stay in Melbourne.

What you should know.

Some parts of Carlton are unapologetically touristy and can get a little tacky. So just explore those areas and then keep going for more authentic streets.

Our recommendations in Carlton

Our favourite Carlton hotels

St Kilda

St. Kilda is a picture-perfect neighbourhood by the sea in south-eastern Melbourne, and what more could you want when you travel to Australia? Located around 15 minutes from the CBD on the tram, it’s popular among tourists and locals alike.

Should You Stay in St. Kilda?

St Kilda Acland Street Tram
Cafés and diners on Acland Street, St Kilda

Whether you’re traveling with friends or family, you’ll always find something to do in St. Kilda – from festivals to beach activities and historic buildings. People-watching in this neighbourhood is simply fascinating.  

Anything you should know?

St. Kilda isn’t on the train line, so you’ll need to use the trams to get around. And although it’s usually pretty safe, it does have an edgier atmosphere than other parts of the city, so be careful and avoid walking alone at night.

I really like staying in St Kilda its got a lot going for it with the beachfront walk and markets, great cafes and cake shops, and excellent tram service to the town.

Where to stay in St Kilda

Our favourite hotels in St Kilda

  • The Prince – a designer boutique property with a bright airy feel
  • The Cosmopolitan – Great location 5-minute walk from the beach

Staying more than a couple of nights? Your own apartment by the beach can be a great decision.

Local tip: Download the Myki app to your phone to save bothering with a card.


Docklands is a recently rejuvenated area that’s only a few stops from the city centre on the free tram. It has a quieter, more relaxing atmosphere, as well as a local appeal that will encourage you to slow down and relax.

Docklands Melboune a great place to stay
Docklands offers lots of apartments and is in the free tram zone

Should You Stay in Docklands?

This is where to stay in Melbourne if you want to get away from the crowds and the busyness of the city centre. This neighbourhood is close enough to the centre that you can visit and return to your oasis with a renewed appreciation for the local feel. And there are lots to do in this area too, from the Melbourne Star Observation Wheel to the stadium where you can watch an Aussie Rules football game on the weekend.

What you need to know first?

This is a more local neighbourhood with a quieter feel, so if you want to be on the go all day and clubbing all night, this probably isn’t the neighbourhood for you. 

Where to stay in Docklands

Our favourite hotels in Docklands

There are loads of apartments in Docklands but the quality can be variable. Many of these offer great views and plenty of space. We suggest you look at Quest NewQuay or AKOM at Docklands

South Yarra

Busy and sophisticated, South Yarra is mostly for the more upscale traveller. It’s famous for shopping and has several popular shopping areas as well as boutique hotels. It’s also just a few train stations from the city, so it’s perfect if you want to be close to the CBD but enjoy a more upscale atmosphere.

South Yarra is a good spot to stay in Melbourne
Shopping heaven – Chapel Street

Should You Stay in South Yarra?

You should stay in South Yarra if you want to shop. Spend the day or even longer at Chapel Street for some of the best and most popular stores in the city, then try Toorak Road if you still haven’t spent enough money. While you’re in this part of the city, try one of the many boutique accommodation options for a little luxury. 

What you should know before you choose South Yarra

Staying in this part of the city can get pricey, particularly if you want to get the most from your local shops. It’s also a busy area, so don’t expect a quiet, peaceful visit.

Our South Yarra hotel recommendations

  • The Olsen – an Art Series Hotel is a particular favourite of mine. I am a huge fan of John Olsen’s work which hangs throughout the property
  • The Como– 5-star luxury – great for special occasions


I have even spent a few days staying in an old pub in Williamstown. It was part of a longer trip to Melbourne and the Formula One racing was on – our hotel was adjacent to the track – I did not plan that well!

Where to stay in Melbourne Williamstown
Looking toward Melbourne from Williamstown. Credit: Visit Victoria

We moved over to Williamstown in a bid for some peace and quiet and had a lovely time – like a holiday in a holiday. It takes about 30 minutes to get from Melbourne to Williamstown, but you feel miles away.

Check out these ideas for exploring Melbourne while you are visiting

Got a question? Head over to our Australia Travel Tips Facebook Group and ask a local.

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