Victorian holiday home summer sell off: New tax rules, cost of living squeeze part-time owners out
Victorian holiday home owners are staging a summer sell off as government-led tax changes and rising cost of living expenses hit hard, and buyers are in for their best summer in years.
Property
Don't miss out on the headlines from Property. Followed categories will be added to My News.
A summer holiday home sell off has kicked across the Mornington Peninsula as rising land tax costs combine with cost of living increases to drive part-time owners out.
Agents are reporting significant increases in listings of weekenders, and with median prices falling hundreds of thousands of dollars in some coastal hamlets across 2023, buyers are set for their best chance to make a move since before the pandemic.
New PropTrack data shows the number of homes for sale in Somerville and McCrae rose about 13 per cent in the lead up to summer and in the aftermath of the Victorian government announcing an increase to land tax starting this year that would impact holiday home owners.
RELATED: Metricon founder Mario Biasin’s family sell beachfront getaway for $20m+
PropTrack: Most affordable and expensive streets in Melbourne revealed
Victoria’s Top 50 homes: Readers’ choice reveals what are the hottest properties in state
Economist Angus Moore said it was plausible this could be impacting buyers’ and owners’ plans.
“From first principals, if this makes it slightly less attractive to own a second home you would expect that you will see some of these come back into the hands of owner occupiers,” Mr Moore said.
Belle Property Dromana principal Grant McConnell said McCrae was probably a front runner for rising listings, with most of his listings now holiday houses as owners said “see you later” to the beach house, even as fewer people were looking to buy a getaway.
Mr McConnell added that prices remained well above pre-Covid levels, but could be worse if some owners were not instead choosing to sell their home in Melbourne’s suburbs and move to the coast full time.
However PropTrack figures show massive drops in some of the most-expensive markets on the peninsula, with Portsea house prices tumbling $780,000 (20.9 per cent) to $2.925m in the past year, while nearby Sorrento tumbled 9 per cent to $2.15m.
Mr Moore said while a broader trend of coastal area home prices falling was good news for buyers this summer, more time was needed to see whether that trend would continue.
Peninsula-based buyer’s advocate Michael Sier said holiday-home hunters and investors alike had been “spooked a little bit” by the land tax change and interest rate rises.
“But buying conditions are great, as there’s not a lot of competition,” Mr Sier said.
The Buyer X director said much of the demand was now from downsizers who had sold acreages in other parts of the Peninsula, families looking for a sea-change before their kids start schools and first-home buyers.
Katherine and Manuel Perez plan to make their first home a coastal getaway and are eyeing ex-commission houses listed for as little as $600,000 in Mornington.
“It’s an hour’s drive from Melbourne, so it’s not that bad … and it’s all worth it when you get home,” Ms Perez said.
While they were still encountering others at open homes, she said agents had indicated few did more than inspect.
PropTrack data also shows options for buyers soared 28.8 per cent in Clifton Springs across the past year, Victoria’s biggest increase in coastal listings.
But Stockdale & Leggo Drysdale director Daniel Lamana said the Geelong-area suburb was not experiencing a holiday home exodus. Instead, a growing number of those who relocated from Melbourne during the pandemic were returning to the big smoke.
WHY WE’RE SELLING OUR HOLIDAY HOUSE
Selling the family holiday home has been a tough decision for Gary and Gabrielle Burton.
But with the cost of living and borrowing money rising, new taxes impacting their weekend getaway and construction underway on their dream home in Melbourne’s outer east — they’re ready to say farewell.
The three-bedroom house at 1C Beverley Rd, McCrae, they built in the subdivided back yard of their neighbour about a decade ago has hosted family catch ups at summer, been a space to watch the footy in winter and for the past 13 months the Burton’s have lived there full time after work started on their new home.
“There’s a house and a cafe between us and the beach,” Mr Burton said.
“We have loved it to bits. And there’s a view of the water and the lighthouse from the rooftop deck, which we think might be fairly rare to have one in the area. It’d be pretty difficult to get planning to build one these days.”
While they had loved it as a holiday home, they’re also sure the relatively new double-storey will suit a family looking to live there full time if buyer types in the area have changed their plans from escaping Melbourne part time to full time.
“It’s a good little spot — and we’ll miss it that much we’ll probably get back down here in a few years time,” Mr Burton said.
Belle Property Dromana principal Grant McConnell will handle the sale which is scheduled for auction with a $1.25m-$1.35m price tag at 3.30pm on February 24.
Sign up to the Herald Sun Weekly Real Estate Update. Click here to get the latest Victorian property market news delivered direct to your inbox.
MORE: Inside hoonfluencer Troy Candy’s jaw-dropping mansion upgrade
Templestowe: European-inspired mansion dubbed a ‘mini museum’ with $3m+ marble
First look: New Coast shopping centre for surprise site
A long-empty site in a surprise location will be transformed into a retail showroom complex under fresh plans lodged with the council. FIND OUT WHERE
Revealed: How much rent you need to pay in every Qld suburb
Rents have increased again in 252 Queensland suburbs, reversing the brief downward trend recorded just three months ago. See how your suburb compares!