Coastal paradise slides

Victoria’s Mornington Peninsula is feeling the adverse effects of Melbourne’s softening prestige market.

26 Farnsworth Avenue Portsea is for sale with hopes of $5.5m to $6m.

The glamour beachside suburbs of Victoria’s Mornington Peninsula have started to feel the adverse effects of Melbourne’s softening prestige market, with price falls accelerating over the December quarter.

At a time when the region, which includes suburbs such as Portsea, Sorrento and Blairgowrie, receives an influx of holidaymakers, real estate agents are negotiating with more cautious buyers.

Kay & Burton director Liz Jensen said the 25km Peninsula Link freeway had resulted in an “unprecedented number of visitors” including day trippers, holiday-makers and property owners.

While many take a shine to the area and consider buying, tighter lending conditions had made it tougher for discretionary spending despite the broad range of properties available across all price ranges.

“We certainly observed a greater volume than usual of vacant land sites and long-held family properties offered to the marketplace this summer selling season,” she said.

“This is probably attributed to the families becoming larger over time and realising the commercial value of their much-loved retreat and accordingly decided to offer the privilege to the next deserving family.”

26 Farnsworth Avenue, Portsea.

The summer period typically represents an opportunity for real estate agents to educate buyers and prospective purchasers on the Mornington Peninsula lifestyle and market conditions before genuine negotiations began after the summer crowds disappear.

“February to Easter is traditionally our strongest selling season, where perspective purchasers secure their holding within our thin marketplace as an financial investment and lifestyle support system,” she said.

CoreLogic RP Data figures compiled for The Weekend Australian show the total number of homes advertised for sale in Portsea and Blairgowrie in the 12 months to the end of December 2018 was on par with 2017. Sorrento showed a slight increase in the total number of houses listed for sale in 2018, with 140 properties advertised compared to 127 in 2017.

CoreLogic RPData head of research Tim Lawless said dwelling values in the region peaked in April 2018 and a decline in values accelerated over the December 2018 quarter, falling 4.5 per cent.

Nationally, Australia’s housing market experienced its greatest declines since the GFC with property prices falling 4.8 per cent last year, predominantly weighed down by sharp declines in Sydney (-8.9 per cent) and Melbourne (-7 per cent).

“Generally speaking the premium coastal housing markets have also weakened as the slowdown in housing has started to bite nationally,” Lawless said. “The most likely reason for this is the fact that a lot of demand for premium coastal property is fuelled from the wealth in capital cities. With premium housing in the capital cities (particularly Sydney and Melbourne) falling rapidly, demand for prestige coastal housing is also easing.

“While the region’s housing is quite diverse, we know that across Melbourne the premium housing sector is falling fastest and it appears that there is little exception on the Mornington Peninsula.”

Jensen is asking $5.5 million for the lavish 26 Farnsworth Avenue, Portsea property, with five bedrooms and three bathrooms on a 3200sq m block.

While Jellis Craig director Emil Foller has received strong interest in a premium property at 5 Pembroke Road, Portsea from Melbourne families looking for “the ultimate retreat”.

It’s expected to attract offers between $4.4m and $4.6m, with buyers attracted to its striking contemporary architecture, privacy, elevated position and bay views.

5 Pembroke Road, Portsea.

Mr Foller described current conditions for the market on the southern peninsula, taking in the upmarket Portsea and Sorrento area, as “very price-sensitive”.

“December and January has seen some challenges but we are also seeing good activity for well-located, quality homes,” Mr Foller said.

“When the property is priced right we often see buyers prepared to compete for a home both in auction and private sales situations. There are plenty of buyers on the sidelines and in the last couple of weeks we have seen increased activity with the buyers making offers and bidding on auctions. Buyers are cautious but also ready to snap up a good value proposition.”