What does "spending the summer" in Australia mean exactly? Long-term holiday? Working holiday? Extended stay?
Confused.
Anyhow Sydney is
generally more expensive than Melbourne. Sydney has a good inner-city bus network, Melbourne has a good inner-city tram network and you're likely only to use the trains if you're commuting from the burbs (Melbourne or Sydney) - why on earth would you want to do that?
If you're looking at rentals in Melbourne/Sydney -
www.realestate.com.au www.domain.com.au
recommendations in Melbourne - dense urban inner-suburbs:
- Balaclava/St Kilda East (excellent distance-wise to the city and all the local amenities you're ever going to need - 2 high frequency tram routes, both end up in the city, one takes you via St. Kilda and has a station on the Sandringham line which is the fastest way into the City, pretty cheap - 1 bedroom flat goes for about $200-250AUD per week - look at Share options though - much cheaper, big Jewish area (bakeries!) and Carlisle St is a personal favourite high street).
- Windsor/Prahran (closer to the city on same train line as Balaclava, it's at the bottom/gritty end of Chapel St, still relatively cheap area, excellent amenities, Chapel St tram blows chunks but all the cross tram routes are good - I prefer this end to South Yarra end of Chapel which is where most of the show ponies play)
- Richmond (one of the densest suburbs and also the greatest diversity of people (ethnicity and socio-economic group) - big range of stuff available here, Bridge Road is shoppers central and Victoria St is Little Saigon, I'd personally stay away from North Richmond (Victoria St) - a bit scummy, but if scum is what you're looking for - eh knock yourself out), Best to look around Bridge Road or anywhere near Burnley station (lots of trains all throughout the day), Bridge Road and Victoria St trams are pretty slow). Richmond is a big suburb - western Richmond is walkable distance to city, eastern (Burnley) is best accessed by Train.
- Fitzroy - "Melberlin" (cringe, yes I know) - alternative, excellent PT (2 tram routes), walkable distance to City (15 min max), right near Carlton Gardens, great nightlife on Brunswick St, very alternative area, bit scummy around Smith St, stick closer to Brunswick St in your search) - can be cheap, can be expensive to rent around here.
- North Melbourne, a favourite area of mine, (quieter, good local strip on Errol and Victoria Sts, #57 tram is ok, but its like Fitzroy, you'll find yourself walking into City rather than tramming it, hard to find places usually cos you're competing with students who go to the adjacent University of Melbourne and at the other end of the spectrum you're competing with Doctors/Nurses/Medical Professionals who work in the adjacent hospitals (Royal Melbourne, Royal Childrens and Royal Women's hospitals are literally next to the University)).
Middle ring suburbs with relatively good quality PT / amenities (don't even look at these until you've exhausted all options above):
- Carnegie - a diamond in the rough, sees trains every 15min during the day, higher in peaks, 20 min at nights, good local high st, around the corner from CHadstone if you feel the need to visit a large shopping centre (mall to you).
- Camberwell - blue ribbon Liberal (conservative) area, but dont let it frighten you, high quality train frequencies into the city (15 min during day, 5-6 min in peaks with many express trains), a long tram route which evenutally takes you to the city, but takes you through other inner 'hoods first, lots of wealthy mansions/households back from Burke Road (main drag) - expensive-ish to live (And eat!) in the area, but can find bargains - oparticularly in adjacent HAwthorn East).
- Glenferrie - same train line as Camberwell, excellent local high street and good mix of people in the area cos of Swinburne University, relatively cheap ( I think), tram route is another long which eventually connects you with Malvern and Balaclava.
- Brunswick - inner north, Lygon St and Sydney Rd trams Upfield line, good transport links, excellent local high streets - very ethnic (Southern Euro)
btw "suburb" in Australia = neighbourhood in N.A.
HTH.
), despite having only a 5,330/sq mi density. So I suspect the post-industrial/suburbanization phase in Australia did not take as heavy of a toll on Australian cities as it did on American ones (let's face it, we also had severe racism-driven district redlining/white flight here), so the low density there I imagine does not necessarily or at all indicate a lesser urban quality of life (which may then translate to poor walkability). Okay, I'm seriously digressing here and I obviously pulled the last few sentences out of my a** 
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