Water trading and licence transfers

Water trading is the buying and selling of water entitlements by licence holders, and supports improved environmental and economic outcomes by allowing water to be allocated where it is most valued. Find out how to apply to trade water, or transfer your licence when selling your property.

Trade water

Water trading is the only way to obtain new or additional water allocations in the Yarra Basin, as a licensing cap prevents additional water being taken for commercial or irrigation purposes.

You can trade some or all of your licensed water volume on a permanent or temporary basis.

The buyer and seller privately negotiate prices, and Melbourne Water must approve all trades in writing before the water can be used. We will only approve trades that do not adversely impact other licence holders or the environment – and therefore encourage trading downstream or locally rather than upstream or to a different catchment.

For more details on trading limitations and considerations, download our fact sheet:

Register your interest

If you’re thinking of trading water, submit an expression of interest so we can record your details in our register and put prospective purchasers in contact with you. There is no obligation to trade at any time.

Prospective buyers can get a copy of our trade register by contacting the Diversions Management team on 131 722.

Apply online

If you wish to trade water in the current financial year, you must apply before 31 March.

Permanent or temporary water trade application

Transfer a licence – property sales

If a property has a diversion licence, the licence holder can choose to permanently transfer it to the buyer (in part or full) upon sale of the property. This is different to water trading because it doesn’t change where the water is taken from or used.

Licences do not automatically transfer with the land at settlement. Buyers interested in an existing water entitlement should negotiate its transfer as part of the property sale, and ensure this is stated in the contract.

Licence holders who choose not to transfer their entitlement to the buyer must transfer or trade it to another suitable property, approved by Melbourne Water, within 12 months of settlement.

Apply online

Use our online application form to transfer your water entitlement once you’ve sold your land:

Diversion licence transfer application