Short answer: Sydney is 15–20% more expensive than Melbourne overall, with the gap concentrated in housing. Sydney’s median two-bedroom apartment rent (Domain Q1 2026) is approximately 20% higher than Melbourne’s equivalent; Sydney groceries are 5–8% more expensive; Sydney transport, dining out, and childcare are roughly 10–15% more expensive. Salaries are slightly higher in Sydney for some sectors (finance, executive) but the gap doesn’t fully offset the cost difference.
Here’s the detailed breakdown.
Housing — The Biggest Gap
Median two-bedroom apartment rent (Domain Q1 2026):
- Sydney inner suburbs (Surry Hills, Newtown, Glebe): $750–$900/week
- Melbourne inner suburbs (Fitzroy, Carlton, South Yarra): $620–$780/week
Median three-bedroom house rent:
- Sydney inner-east (Bondi, Coogee, Randwick): $1,400–$2,000/week
- Melbourne inner-east (Hawthorn, Camberwell, Kew): $900–$1,500/week
Median house purchase prices (Domain Q1 2026):
- Greater Sydney median: approximately AUD $1.4 million
- Greater Melbourne median: approximately AUD $980,000
The 35–40% house-price gap is the structural difference. For UK migrants comparing on relocation budgets, the same package-level housing budget delivers a meaningfully better Melbourne property than Sydney equivalent.
Groceries
Numbeo and ABS Consumer Price Index data put Sydney groceries 5–8% above Melbourne for an equivalent basket. Specific items where the gap is wider:
- Fresh produce (Sydney’s higher median produces a structural premium)
- Dining-out groceries (rotisserie chicken, prepared salads)
- Specialty imports
For the same weekly shop at a Coles or Woolworths: budget around AUD $150–$200 for a single person in Melbourne, AUD $160–$215 in Sydney.
Restaurants and Dining
Sydney restaurant prices are roughly 10–15% above Melbourne for equivalent venues. A casual mid-range dinner for two:
- Melbourne: AUD $90–$130 with wine
- Sydney: AUD $100–$150
Fine-dining tasting menus:
- Melbourne (Attica, Cumulus): AUD $200–$280 per person
- Sydney (Quay, Saint Peter): AUD $250–$350 per person
The gap in casual dining is smaller than in fine dining; the gap in tourist-precinct restaurants is larger than in neighbourhood restaurants.
Coffee
Approximately equal in 2026. A flat white in inner Melbourne is $5.50–$7; in inner Sydney $5.50–$7. The gap that existed pre-2018 has effectively closed.
Transport
Public transport is broadly equivalent in cost. Sydney Opal: daily fare cap around $18; Melbourne Myki: daily fare cap around $11.
Taxi and rideshare: Sydney is roughly 10% more expensive than Melbourne for equivalent distances.
Petrol and parking: Sydney CBD parking is significantly more expensive than Melbourne CBD ($25–$50/day vs $15–$30/day for typical commercial garages).
Childcare
Australian government childcare subsidies (the Child Care Subsidy) flatten the gap somewhat. Pre-subsidy:
- Sydney centre-based care: AUD $130–$200/day
- Melbourne centre-based care: AUD $115–$175/day
The Sydney premium is roughly 10–15% across most age brackets. After means-tested subsidies, the out-of-pocket gap is smaller.
Healthcare
Australian Medicare covers most healthcare equally regardless of city. Private health insurance premiums are similar in Sydney and Melbourne (within 5%). Specialist gap fees can vary by clinic but the city-level gap is small.
Education
Public schools (state schools): no fees in either city; quality depends on catchment area.
Private schools (independent and religious): annual fees broadly comparable. Top-tier Sydney schools (Sydney Grammar, Cranbrook, SCEGGS): AUD $40,000–$45,000/year. Top-tier Melbourne schools (Melbourne Grammar, Scotch College, Geelong Grammar): AUD $40,000–$45,000/year.
Income Comparison
Median full-time earnings (ABS Average Weekly Earnings, May 2025):
- Sydney: approximately AUD $108,000/year
- Melbourne: approximately AUD $97,500/year
The salary gap (around 10%) is smaller than the cost-of-living gap (around 15-20%), so on average Melbourne offers more disposable income for an equivalent professional role.
For finance and senior-executive roles, Sydney premiums are typically larger (15–25%) and partially offset the cost gap. For most other professions, Melbourne is the better cost-adjusted option.
What This Means for You
For a UK migrant moving to Australia in a similar professional role:
- Sydney is meaningfully more expensive but offers slightly higher salaries
- Melbourne is more affordable for the same lifestyle
- Both cities are roughly equivalent on healthcare, public transport, and education costs
- The biggest single decision factor is housing — same nominal price, more space and amenity in Melbourne
For tourists deciding where to spend more days: Sydney costs roughly 15% more per day for equivalent accommodation and dining; budget accordingly.
For more, see Sydney vs Melbourne, Melbourne vs London cost of living, and Sydney vs Melbourne property. Domain Q1 2026 rental data, ABS Average Weekly Earnings, and Numbeo cost-of-living indices are the sources cited.