Quick price summary: Aged Care Facilities in Melbourne (2026)
- Low end: $60–$80 per day (basic daily care fee only, government-subsidised residents)
- Mid-range: $150–$350 per day (basic daily fee plus means-tested fee and modest accommodation costs)
- High end / enterprise: $400–$700+ per day (premium facilities with RAD over $800,000 and extra services)
Prices in AUD. Last updated 2026.
Aged care facilities in Melbourne provide permanent residential care for older Australians who can no longer live safely at home. The costs cover accommodation, nursing care, personal support, meals, laundry, and daily living assistance. Some facilities also offer optional extra services such as specialised therapies, single rooms with premium furnishings, or enhanced social programmes, which attract additional fees on top of the regulated amounts.
Costs vary significantly depending on your financial situation, the facility you choose, and the level of care required. The Australian Government subsidises a portion of residential aged care costs for eligible residents, but the share you contribute is determined through an income and assets assessment conducted by Services Australia. Understanding how each fee component works before you or a family member enters permanent residential aged care can prevent costly surprises.
What Do Aged Care Facilities Cost in Melbourne?
Residential aged care in Melbourne is made up of several distinct fee types rather than a single flat rate. Every resident pays the basic daily fee, which is set by the Australian Government at 85% of the single aged pension. As of March 2026, this sits at approximately $63–$66 per day (around $23,000–$24,000 per year). On top of this, residents with sufficient income or assets may be asked to contribute a means-tested fee, which is capped at $35,313 per year and $76,514 over a lifetime (figures are indexed and reviewed twice a year, in March and September).
Accommodation costs depend on the room you choose and the facility’s published pricing. Melbourne aged care homes set their own room prices, with Refundable Accommodation Deposits (RADs) typically ranging from $350,000 for standard rooms in outer suburban facilities to over $800,000 for premium rooms in inner-city or high-end facilities. The average RAD across Australia sits around $470,000, though Melbourne’s inner suburbs and bayside areas frequently exceed this. If you choose not to pay a lump sum RAD, you can instead pay a Daily Accommodation Payment (DAP), which is calculated using the Maximum Permissible Interest Rate (MPIR) set by the Australian Government. You may also pay a combination of both.
Price Breakdown by Service Level
| Service Level | What You Get | Typical Price Range | Best For |
|---|---|---|---|
| Government-Supported (Basic) | Standard room, nursing care, meals, personal support. Accommodation costs fully or partially covered by government subsidy. | $60–$80 per day (basic daily fee only) | Residents with income and assets below the threshold who qualify for government-funded accommodation |
| Standard Residential | Private or shared room, full nursing and personal care, meals, laundry. RAD from $350,000 or equivalent DAP. | $150–$250 per day all-in | Residents in outer or middle-ring Melbourne suburbs with moderate assets |
| Mid-Range / Enhanced | Private ensuite room, higher staffing ratios, broader activity programmes, optional therapy services. RAD $470,000–$650,000. | $250–$400 per day all-in | Families seeking a step up from standard care without paying premium prices |
| Premium / High-End | Hotel-style rooms, restaurant-quality dining, concierge services, specialist dementia care, premium lifestyle programmes. RAD $650,000–$800,000+. | $400–$700+ per day all-in | Residents in inner Melbourne or bayside suburbs with significant assets and a preference for premium environments |
What Affects the Cost of Aged Care Facilities in Melbourne?
Your income and assets assessment outcome
Services Australia conducts an income and assets assessment before or shortly after a resident enters permanent residential aged care. The result determines whether you pay a means-tested fee and at what level. Residents with assets below $59,500 (approximate 2026 threshold) and income below the relevant threshold may qualify as supported residents, with the government subsidising their accommodation costs. Residents with assets above $470,000 are generally required to pay the full accommodation price set by the facility.
The RAD versus DAP decision
You can pay your accommodation cost as a lump sum RAD, a daily DAP, or a combination of both. Paying a full RAD avoids daily interest charges, as the RAD is refunded in full when you leave aged care (or pass away, minus any agreed retention amounts). The DAP is calculated using the MPIR, which the Australian Government sets and reviews regularly. Choosing the wrong payment structure for your financial circumstances can cost or save tens of thousands of dollars over the course of a stay.
Location within Melbourne
Facilities in inner Melbourne suburbs such as South Yarra, Hawthorn, and Brighton charge substantially higher RADs than those in outer areas such as Frankston, Werribee, or Craigieburn. The difference in RAD between an inner-city and a regional or outer suburban facility can be $200,000–$400,000 for a comparable room standard, which directly affects your DAP if you choose not to pay the lump sum.
Extra and additional services
Some Melbourne aged care homes offer an “extra service” designation, which means they charge an additional daily fee (commonly $20–$100 per day) for access to enhanced lifestyle amenities. Other optional services such as specialist physiotherapy, podiatry, hairdressing, or escort services carry separate charges. These fees are not government-regulated and are negotiated directly with the provider.
Care needs and clinical complexity
The Australian Government funds aged care homes based on each resident’s assessed care needs through the AN-ACC (Australian National Aged Care Classification) system. Higher clinical needs attract greater government funding to the facility. While residents do not pay more for higher clinical care directly, facilities with specialist dementia units or high-dependency care often carry higher accommodation prices reflecting the investment in staffing and environment.
How to Get Accurate Quotes
- Complete a My Aged Care assessment. Contact My Aged Care on 1800 200 422 or apply online to be assessed for residential aged care eligibility. Without an approved assessment, you cannot enter a permanent aged care facility.
- Submit an income and assets assessment through Services Australia. This determines your means-tested fee and whether you are eligible for government-funded accommodation support. Use the fee estimator on the Services Australia website to get an indicative figure before committing to a facility.
- Request published accommodation pricing from each facility. All aged care homes in Australia are required by law to publish their room prices on the My Aged Care website and in their own documentation. Ask for a written schedule of all fees, including the basic daily fee, means-tested fee, accommodation cost, and any extra service fees.
- Compare facilities using the My Aged Care Find a Provider tool, filtering by location, care type, and room price. Visit shortlisted Melbourne facilities in person before making a decision, and ask about current vacancy timelines.
- Speak with a financial adviser who specialises in aged care before signing any agreement. A fee-for-service aged care financial information specialist (FIS) or financial adviser can model the RAD versus DAP decision based on your specific assets, income, and likely length of stay.
Red Flags to Watch Out For
- A facility that cannot provide a written fee schedule on request. All residential aged care providers in Australia are legally required to disclose their fees transparently before you sign a Resident Agreement.
- Verbal-only quotes for room prices or care fees. Any figure that is not confirmed in writing should be treated with caution.
- Pressure to sign a Resident Agreement before your income and assets assessment result has been received. Your fees cannot be accurately determined without this outcome, and signing too early may create confusion about your financial obligations.
- Unusually low RADs with unexplained conditions attached. Some facilities apply retention amounts or have complex fee structures that reduce the refundable portion of your deposit at exit.
- No registered nurse on site around the clock. Since November 2023, all Australian aged care facilities are required to have a registered nurse on duty 24 hours a day. Any facility that cannot confirm this is non-compliant.
- A facility that cannot clearly explain the hardship provisions administered by Services Australia. If you genuinely cannot afford aged care costs, the Australian Government administers hardship assistance. A reputable facility will acknowledge this and direct you to the relevant process rather than dismissing your concerns.
Frequently Asked Questions
How much do aged care facilities cost in Melbourne on average?
A Melbourne resident entering permanent residential aged care can expect to pay the basic daily fee of approximately $63–$66 per day, plus an accommodation cost. If paying by DAP on an average RAD of $470,000 at the current MPIR, the daily accommodation charge adds roughly $60–$75 per day. Residents who also pay a means-tested fee may contribute an additional $20–$96 per day depending on their assessed financial situation. Total out-of-pocket costs for a mid-range Melbourne facility typically fall between $150 and $280 per day, though this varies considerably based on individual circumstances and the facility chosen.
Why are some aged care facilities prices so much cheaper?
Government-supported residents pay lower costs because the Australian Government subsidises their accommodation. Facilities that accept a higher proportion of supported residents may appear cheaper but offer the same regulated care entitlements. Some outer suburban Melbourne facilities also set lower RADs to reflect local property values and competition, which results in a lower DAP for residents not paying a lump sum. The basic daily fee and means-tested fee are the same regardless of which facility you choose, as both are set or capped by the Australian Government.
Is it worth paying more for aged care facilities in Melbourne?
Paying a higher RAD at a premium Melbourne facility does not always translate to better clinical care. The quality of nursing and personal care is regulated nationally, and all facilities must meet the same Aged Care Quality Standards. What higher fees typically buy is a better physical environment, more single-ensuite rooms, improved dining, and a wider range of lifestyle activities. For residents who will be in care for several years and have the assets to support a higher RAD without financial hardship, the quality-of-life difference can be meaningful. Families should assess both the financial impact and the individual’s personal preferences before committing to a higher-cost facility.
Planning aged care costs early gives families more options and prevents rushed decisions under pressure. Getting the income and assets assessment done, understanding the RAD and DAP structures, and speaking with a qualified aged care financial adviser are the three steps that most reliably lead to an arrangement that is financially sound and suits the resident’s needs.
