The Ultimate Guide to Renting a Car in Melbourne (in 2024)

Melbourne, one of Australia's biggest and busiest cities, should most definitely be part of your itinerary when you make your way Down Under. The city has an incredible culture, food scene, and road trip opportunities that you don't want to miss!

Everyone has heard of the famous Great Ocean Road, and trust me, road-tripping is definitely the way to go! You can read how to plan an epic road trip from Melbourne to Adelaide in my post here.

I understand that renting a car in a different city or country can be a bit of a headache with high rental rates and sketchy rental companies out there. But don't worry! I've got you covered.

With proper preparation and research, including obtaining an International Drivers License, you can confidently navigate the rental process, ensuring a smooth and stress-free experience for your travels.

To give you a stress-free experience when renting a car in Melbourne and exploring the city and its surroundings, I've written the ultimate guide to renting a car in Melbourne to answer all your questions.

Do you really need a car in Melbourne?

When it comes to getting around in Melbourne, you might be wondering if renting a car is necessary. Well, it really depends on the type of trip you're planning and your personal preferences.

Are you planning day trips or a road trip?

If you're up for a road trip across Victoria or exploring outside of Melbourne CBD, renting a car is definitely the way to go! You'll have the freedom to drive wherever and whenever you want.

Plus, some of Melbourne's and Victoria's best spots are best reachable by car, like the breathtaking Great Ocean Road, the charming Mornington Peninsula, or the picturesque Yarra Valley wine region.

If you just want to explore within the city…

On the other hand, if you're planning to stay within the city limits and won't be driving much, renting a car might not be the best choice. Melbourne's traffic can get pretty hectic, and parking can be pricey.

Keep in mind that public transport in Melbourne is extensive and reliable. Buses, trams, and trains can easily take you to most destinations within the city, and the prices are generally reasonable.

Moreover, there's a free tram zone in the City Center (CBD) where hopping on the tram won't cost you a cent.

How to rent a car in Melbourne, Australia

If you're renting a car in Melbourne, it's essential to be prepared.

This guide covers the necessary documents, rental locations, top rental companies, costs involved, insurance, and some basic Australian traffic rules.

In my personal experience, I like using Discover Cars, which makes the process of comparing car rental prices and discovering the best deals straightforward.

This platform provides a user-friendly interface that allows you to effortlessly evaluate rental options from various providers, ensuring you can secure the best possible rates and rental terms to suit your needs.

Additionally, the website offers valuable information, such as customer reviews and comprehensive rental package details, which can further aid in making an informed choice when booking a rental car in Melbourne.

Prep: Things you need to rent a car in Australia

To rent a car in Australia, there are a few things you'll need to check off the list. Don't worry, it's not too complicated!

Car rental age in Australia

First, you'll need to be at least 21 years old. And if you're over 25, you might even score a better rate on your rental car and insurance.

Additionally, some luxury or specialty vehicles may have a higher minimum age requirement.

Valid drivers license

Next, make sure you have a valid and full driving license that you've held for at least one year. If you have a non-English foreign driver's license, you might also need an international driver's license.

Credit card payments & deposits

Having a credit card would be ideal and can be used as a form of security in case there are any additional charges, such as fuel, tolls, or damage to the rental vehicle.

But no worries if you only have a debit card, you can still rent a car. Debit cards are often accepted, but they may come with additional requirements and restrictions, such as a higher security deposit or proof of additional insurance coverage.

Be prepared that some rental companies might hold a deposit of up to AUD$2500 at the time of your rental, and they'll refund it when you return the car.

As policies can vary between rental companies, it's a good practice to inquire about the specific deposit amount and policy when making your reservation or when picking up the rental car.

Where to rent a car in Melbourne

When you're in Melbourne, you'll find plenty of Melbourne car rentals in and around the city to pick up and return your car.

The most popular locations are at:

• Melbourne Airport
• Melbourne CBD (Downtown)

Renting a car at the Melbourne Airport and returning it here is definitely the easiest and most stress-free way, especially if you're staying for a shorter time and arriving or leaving via the Melbourne Airport.

Keep in mind that Melbourne Airport rentals can be pricier than downtown rentals, but there are some great-rated car rental companies available and it might be worth the extra fees.

The cheapest and best-rated Melbourne car rentals at the Melbourne Airport are:

• East Coast Car Rentals

• Sixt

• Bargain

• Alamo

• Jucy cars & campervans

If you're already staying in Melbourne City, renting a car downtown might make more sense. It's convenient and could even save you some money.

Even if you arrive at the Melbourne Airport, you can take the Melbourne SkyBus from the Melbourne Airport to downtown and pick up your rental car.

Book your SkyBus ticket easily online here.

It might take a bit more effort, but it's worth considering, depending on the price difference.

The cheapest and best-rated Melbourne car rental in Downtown are:

• Sixt

• East Coast Car Rental

• Budget

• Avis

To figure out the best car rental agency and location, do some research and book in advance.

Rental car pick up & drop off

When you're ready to pick up your rental car, just remember to bring along all the necessary documents:

• Your driver's license
• Payment card
• International driving permit

Once you've got the paperwork sorted, the rental company will likely give you a quick rundown of the rental vehicle and show you the basics, like how to lock and unlock the car, and how to access the trunk.

Before you sign off on it, take a few minutes to thoroughly inspect the car and make sure everything looks good.

If you notice any damages or scratches that weren't mentioned on the documents, just let the rental car company know before you hit the road, so there won't be any surprises with extra costs when you return the car. I additionally like making a quick video on my phone, no matter where in the world I rent a car. This way you have everything documented properly.

Also, please make sure to double-check that you're given the right model. If you're booking an SUV or a convertible, that's exactly what you should receive!

When it's time to drop off the car, don't forget to double-check that you've returned everything that came with it:

• Multiple keys
• Parking tickets
• A full tank of fuel

Take a few minutes to give the car a once-over for any possible damages or scratches.

If you happen to spot any unexpected ones, make sure to mention them as well, otherwise, the rental car company can still deduct charges from your credit card without your consent, because you signed the contract at the start.

Cost to rent a car in Melbourne

Renting a car from the Melbourne Airport can be a bit pricier at times compared to renting in Downtown.

Below I'll provide you with some average prices (per day) that I found for different car models from both Melbourne Airport and downtown locations.

Melbourne Airport:

• Compact (Kia Rio or similar) – AUD$86

• Crossover SUV (MG HS or similar) – AUD$86

• Standard SUV (Mitsubishi Outlander or similar) – AUD$96

• Premium Sedan (Peugeot 508s or similar) – AUD$107

Melbourne CBD/Downtown:

• Compact (Toyota Yaris or similar) – AUD$66

• Crossover SUV (Mitsubishi ASX or similar) – AUD$78

• Standard SUV (Mitsubishi Outlander or similar) – AUD$84

• Premium Sedan (Peugeot 508s or similar) – AUD$113

If you are looking for the cheapest rental cars, then the car rental agencies in Downtown usually have the best car rental deals and you're likely to save money picking up your hire car here.

Here, you can get an SUV rental, a luxury rental, a small car, a convertible rental, or even an electric car for an affordable price.

Purchasing car insurance

When you're booking your rental car, it's important to think about the kind of insurance coverage you'll want. While Australian law requires at least third-party liability insurance, going for a fully comprehensive policy is a smart way to go.

Most rental companies offer different insurance packages with varying levels of protection. Before you decide on any insurance, check if your credit card already covers rental car insurance – it could save you from getting a separate policy and then being double insured.

This situation could potentially also pose a challenge in case of an accident, as insurance providers may seek to shift the liability onto each other.

However, many travelers prefer getting their own coverage outside of rental companies for better deals and more comprehensive plans.

So, it's a good idea to do some research and comparison shopping before you make any final decisions!

Basic rules for driving in Melbourne & Australia

Left-hand traffic & speed limits

Whether you're a first-time driver in Australia or an experienced one, it's important to familiarize yourself with the local rules of the road and city.

In Australia, we drive on the left side of the road and I highly advise you to keep to speed limits posted on signs as speeding fines are one of the most expensive in the world.

Seat belts: always, phones: never

It's also good practice to always buckle up and never use your phone while driving – even if you're just checking Google maps or I also like using Waze for directions.

Trams and parking

In the Melbourne CBD, you'll find plenty of parking spaces, both metered and free. Just make sure to read the parking signs carefully for instructions and time limits.

Plus, be aware that trams have priority over other vehicles in the city center.

Alcohol limits

If you're planning to have a drink or two in Australia, especially on warm summer days, be careful. It's important to exercise caution. Australia has very strict laws against driving while intoxicated, with penalties that can be quite severe and expensive – the limit is just 0.05%!

Toll roads

Also, when driving in major cities like Sydney, Brisbane, and Melbourne, you'll come across toll roads on motorways quite often. Note that there are no toll booths in Australia.

Your rental car will have a built-in device that detects toll roads and charges you accordingly. The rental company will then add the toll road fee to your bill when you return the car.

Wildlife accidents

Especially if you're driving on the Great Ocean Road or in rural Victoria – be mindful of kangaroos, koalas and other wildlife! They're undeniably cute and fluffy, but they can be risky for both drivers and cars.

Kangaroos tend to come out in the mornings and at night, and they're attracted to car headlights. It's not uncommon for them to jump onto the road in front of your car.

To avoid any surprises, I'd recommend driving during daylight if you can and avoiding dusk and dawn driving in rural areas.

Top tips for renting a car in Melbourne & pitfalls to avoid 

Here are my top tips for renting a car in Melbourne:

1. Take a moment to read through all the terms and conditions, including the fine print. It's important to understand what kind of coverage is included in the basic rental plan and what additional options are available.

2. Check if your physical credit card offers any car rental insurance to avoid paying for double coverage.

3. Take some time to shop around and compare car rental prices. Different companies may have different deals, so it's worth doing your research before making a decision.

4. Before signing off on the rental, make sure the car model matches the one you booked. Also, be sure to check for any damages or scratches.

5. Keep an eye out for any kilometer limits. Some rental plans come with a limited number of kilometers allowed per day.

What to avoid when renting a car in Melbourne:

1. Be mindful of driving at dusk and dawn in rural areas to avoid any unexpected encounters with kangaroos hopping onto the road.

2. Don't forget to return everything that came with the car when you drop it off, like keys and parking tickets. And don't forget to fill up the fuel tank. It'll save you any unnecessary hassle or extra cost.

3. Avoid falling for any extras that aren't necessary. Opt for the most basic plan if you don't need any additional features.

4. Remember, it's always best to avoid drinking and driving. In Australia, the legal limit is just 0.05%, so stay safe and make responsible choices.

The best road trips from Melbourne

If you're looking for some awesome road trips to do from Melbourne, here are my top 5 favorites:

1. Great Ocean Road

It's the ultimate iconic road trip in Australia! This 189km stretch of coastline from Torquay to Allansford will blow your mind with its breathtaking scenery. The 12 Apostles, Loch Ard Gorge, and the Great Otway National Park are the highlights of this drive and a must-see.

You can do it all in a day, but if you have the time, I highly recommend spending at least 3 days exploring and staying in some of the quaint towns along the way.

2. Mornington Peninsula

Just a short 90-minute drive from Melbourne, the Mornington Peninsula is the perfect weekend escape! It's basically the countryside of Melbourne, all the way down south to Port Phillip Bay.

Here, you can hang out at local wineries, enjoy some amazing food, and spend a day at the Mornington Peninsula Hot Springs, which is the absolute best Spa in the area.

My personal tip: Try to make it to the hilltop pool for sunset to enjoy a breathtaking 360-degree view of the surroundings!

3. Philipp Island

Located about 2 hours south of Melbourne, Phillip Island is home to some of the absolute cutest animals you've ever seen! From adorable little penguins to koalas and seals, this island has it all.

But the real highlight here, without a doubt, is the Penguin Parade at dusk when all the little waddlers make their way out of the ocean. It's an experience you won't want to miss!

4. Yarra Valley

If you're into wine and amazing food, you absolutely have to check out Yarra Valley. It's just an hour's drive from Melbourne and it's home to some of the best wineries in Australia.

Plus, if you're into outdoor adventures, there are tons of beautiful hiking trails to explore. The Yarra Ranges National Park is one of the coolest rainforests in South Australia with stunning waterfalls and hiking trails. My personal favorite is taking a hot air balloon ride at sunrise or sunset!

5. Wilsons Promontory

If you're up for an outdoor adventure, Wilsons Promontory is the place to be. Located about 3 hours from Melbourne, this national park offers some of the best hiking and camping experiences in Australia.

Don't miss out on the breathtaking Squeaky Beach with its soft white sand, and make sure to hike up Mt Bishop for an incredible panoramic view of the entire region.

On your way, you can stop by Mornington Peninsula and Philip Island and spend multiple days exploring the whole coast.

Renting a Car in Melbourne – Frequently Asked Questions

💸 Is renting a car in Melbourne expensive?

 Yes and No! Depending on the type of car you opt for and the rental company you choose, prices can vary from AU$66 per day to approximately AU$150 per day. With a little pre-planning and finding a great insurance deal, renting a car can be quite cost-effective. It's worth taking the time to do some extra research before making a booking.

📅 What is the minimum age requirement for renting a car in Melbourne?

The minimum age requirement for renting a car in Melbourne is typically 21 years old. However, drivers between 21 and 25 years old may incur a young driver surcharge, and some rental companies may have specific age-related policies, so always check with the chosen rental agency for their specific requirements.

⭐ Should I rent a car in Melbourne?

It totally depends on your travel plans! If you're thinking of staying and exploring within the city and like going on guided trips, then it might not be the best idea to rent a car because parking can be pricey and the public transport in Melbourne is great. However, if you're in Melbourne and want to venture out independently to places like the Great Ocean Road, Mornington Peninsula or Phillip Island, then renting a car is definitely worth considering.

❓What do I need to rent a car in Melbourne?

Most car rental companies will require you to have a valid driver’s license, proof of insurance (either through your credit card or an additional policy purchased from the company), and a valid form of payment. It's also important to double-check the age restrictions when booking.

🚗 Can I pick up and drop off the rental car at different locations in Melbourne?

Yes, many car rental agencies in Melbourne offer the option to pick up and drop off the rental car at different locations for added flexibility. However, always confirm this option with the specific rental company and inquire about any associated fees or restrictions, especially when driving to other states.

Renting a Car in Melbourne – Final Words

Renting a car in Melbourne is an awesome idea if you want to explore beyond the city.

With a little research and planning, renting a car can be cost-effective. Just remember to double-check all the requirements before signing off, and keep an eye out for any kilometer limits or additional fees that may apply.

I hope my ultimate guide takes some stress off your shoulders and makes your decision to rent a car in Australia a little easier!