Lakes Entrance Victoria

 

The Age July 2008

Holiday over as beach house listings double

THE holiday could be over for beach house owners as coastal properties close to Melbourne flood the market.

There were double the number of houses for sale in the June quarter in bayside suburbs such as Rosebud West, and in parts of East Gippsland, than in the same period last year, according to property researcher RP Data.

Agents warn that the heady days of frenzied bidding and huge prices for weekenders in Sorrento and Portsea are over. Property observers say the downturn suggests that interest rates and price rises are starting to worry investors.

Listing numbers for bayside suburbs such as Safety Beach and McCrae have risen significantly. Rosebud West has had the biggest increase, up 125% from 32 to 72 houses, followed by Blairgowrie, up 23%, with 85 houses listed compared with 69 last year. In eastern Victoria, Lakes Entrance had 112 houses for sale compared with 62 in the same period last year. Listings in townships such as Golden Beach and Paradise Beach have also nearly doubled.

But there was a slight drop in the number of houses for sale on the Surf Coast. Agents along the Great Ocean Road said towns such as Torquay had a more stable population, and holiday investors were "in it for the long term".

"The areas that you'll see people selling are in the Mornington Peninsula," said buyers' advocate Christopher Koren. "If people have borrowed to go down to places like that and they're paying bigger mortgages for a beach house, they're going to want to cough up and concentrate on their principal residence."

RP Data analyst Tim Lawless said owners could be reacting to higher interest payments and sharemarket losses by cutting out non-essential assets. Other holiday spots in Australia also recorded a jump in the number of properties for sale, including Byron Bay and Terrigal in NSW, and Surfers Paradise. Rye real estate agent Daniel Kavanagh said holiday house owners seemed to be deserting the market. Last year "there were heaps of buyers. Now they've gone and the prices should stabilise." Median house prices in Sorrento and Blairgowrie grew 31% and 48% respectively between June 2007 and this March, according to the Real Estate Institute of Victoria, compared with a 5% increase in metropolitan Melbourne, which experienced a sharp drop after December.

"The buyers have gone, unless you're selling a triple-A beachside real estate that appeals to that group of people that always have discretionary money - lawyers, doctors, surgeons," Mr Koren said.

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