Hey guys!
This is still in the "New Year" period, so it will be expensive. Many rooms will be booked up, so find somewhere central with rooms and book it ASAP. There is an Accommodation link at the top of the page.
Melbourne never has the NYE fever as bad as Sydney. In fact, putting in the 2nd of January into the accommodation search, prices are completely regular (for high season), and there's still loads of choice.
Don't have personal recommendations, alas - my favorite Melbourne hostel closed down a couple of years ago, and the budget hotel I stayed at as an alternative last time through was decidedly underwhelming. If you're just after a dorm room bed, gets good reviews, and is in an absolutely excellent location, with both Fitzroy/Carlton and the CBD in walking distance.
There are a couple very near Flinders street station, the one on Flinders street is more sleep only type of place, there is another on the corner of (i think) Collins and Elizabeth streets, this more of a party hostel. I can't really recommend them as i haven't stayed in them, but they are exceeding well located.
Personally i prefer to stay out in St. Kilda , it is a tram ride from the city but there is alot going on with cool bars and cafes, and maybe a 15 walk upto the Chapel street area which is my favourite place in Melbourne.
is also a popular one. Awesome location in the heart of the laneways on Flinders Lane. This would be my pick if I had to choose.
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