VIC Victorian coastal towns vs inland regional towns in the next 12-17 years

Victoria’s regional property markets to star in 2019

Similarly Moody’s report shows house prices are expected to continue rising in Victoria’s regional centres across this year and into 2020, with Geelong likely to be the best performer.

 

The Victorian coastal hotspots bucking the property downturn

'Ms Parkes and Ms Shergold are selling the Rye Opera House in Rye, a suburb which has become one of the most popular to buy a beachside home in Victoria. Like Ms Parkes and Ms Shergold did more than a decade ago, city dwellers have been flocking to coastal towns. Holiday home buyers, workers who split their time between the city and the coast, and young families moving to these areas have been bolstering sales along the coastlines, although the level of inquiries recently has been a little lower as buyers take time to get finance.

On the Mornington Peninsula, south-east of Melbourne, and the Great Ocean Road near Geelong dwelling prices have been more resilient than in the city. Some 351 homes were sold in Rye between December 2017 and November last year, according to Domain Group data, while prices rose by a median 7.1 per cent last year compared to 2017. “Suburbs and cities within a reasonable commuting distance of the CBD have been more resilient than areas of Melbourne as they’re relatively more affordable,” Domain economist Trent Wiltshire said.

On the Mornington Peninsula, sales have likewise remained strong. The only exception has been in Portsea, which saw a fall of 4.9 per cent between 2017 and 2018. Despite this, selling agent and director of Kay & Burton Portsea Gerald Delany said sales had remained strong over the busy summer period, especially in Rye.

“Sales have been strong, equal to last year,” selling agent and director of Kay & Burton Portsea Gerald Delany said, adding buyers were looking for Mornington Peninsula homes that could range from the $1 million price point to about $6 million or even higher. “We’ve got one – a clifftop property – around the $10 million mark,” he said.

Many buyers were moving to areas like Sorrento and Portsea wanting to spend part of their week working from home and the rest in an office in Melbourne. “They’re looking for one-level homes that are already done, they don’t want to buy an old clanger and do it up,” Terry Sparks from TJ Sparks Real Estate said.'

 

Melbourne’s outer ring (houses up 3.1 per cent) and regional Victoria (up 5.5 per cent) were the big winners of 2018, according to REIV, with affordability, improving infrastructure and first-home buyer incentives boosting demand.

Top annual growth suburb for houses

1. Mt Martha: up 12.3% to $1,100,500

Top annual growth suburb for units

1. Frankston: up 11.9% to $445,000

 

Past performance is not an indicator of future performance. Coastal towns while they do grow can have a short and unexpected boom cycle. Extra caution required.

 

Some of these coastal markets were also "going strong" in 2017 and 2016 and continued to grow in 2018. This is ongoing growth. Flipping is particularly popular in the coastal markets I have mentioned with good success. JohnPropChat what you are saying is very general and can be said for all markets. The current boom cycle was to be expected and has been evident in the market for the past 2 years (not short). Some coastal seachange markets have experienced growth for over 5 years at a larger rate than treechange markets.

 

That doesn't change the fact that the markets moved quite a bit. I am not on the ground there, I exited Melbourne market a year ago when I saw the writing on the wall and I am glad I did.

Everyone's strategy is different but the one common thing that applies to all - entering the market when it is peaking/peaked is risky at best.

 

I completely agree Melbourne's market has peaked. However, this forum has a focus on Victorian regional markets and coastal markets which haven't. Thanks for your input nonetheless.

 

I said peaking/peaked markets. Thanks for your "info" nonetheless.

 

Shepparton is pretty stable with only $10,000-$20,000 growth in 2018. Availability of land is a clear issue (likewise in Melbourne). Interestingly on the Mornington Peninsula there is a limited supply of land as they won’t allow subdivisions from Dromana on down. The Green Wedge zone has also limited the amount of urban sprawl.

It could be becoming less of a problem with overall crime in Wangaratta down 6% in the past year. Thanks for your input.

 

Mt Martha had the strongest median house price growth across Melbourne in 2018 at 12.3%. Mt Martha also become a $1million suburb in 2018. Nearby Mt Eliza and other outer ring suburbs (Cranbourne North and Officer) saw similarly strong growth.

“Mt Martha has been a hot spot for buyers in recent years. It used to be a place where people mainly bought holiday homes but this has changed and now young professionals, retirees and buyers from Melbourne are moving here permanently.”

The suburb was seen as offering good investment properties and “value for money”. The peninsula was a different market from the city and this was reflected in strong prices and healthy buyer numbers, Warlimont & Nutt Mt Martha director Trent Cameron said. "There has been an influx of young families and Baby Boomers attracted by the shorter commute to the city, great beaches and the village. More holiday-home buyers were looking in Mt Martha instead of Sorrento and Portsea to get away from the summer crowds and traffic"

 

Coastal markets also have an advantage due to their fluctuating population throughout the year. In summer the population size of each town increases significantly. On the Mornington Peninsula, this tourism injects more than $1 billion into the area annually.

https://www.theage.com.au/national/...rians-flock-to-the-beach-20141224-12dhst.html

Victoria's coastal resort areas are expecting an influx of 300,000 visitors

 

So, what do you think about Frankston and Frankston South over the next couple of years - stagnation, further decline or something else?

 

Here is a forum for Frankston in 2019.
VIC - Frankston 2019

 

Top Victorian sea and tree change destinations

But changing technology, lifestyle and affordability are adding to incentives for a sea change or tree change, and leaving less reason to wait until retirement to take the plunge.

Now country centres and coastal towns across the state are in the spotlight, many outperforming Melbourne when it comes to price growth.

“Regional areas are doing really well,” realestate.com.au chief economist Nerida Conisbee said.

And notably, a new crowd were making the change to coast and country areas.

“Younger people are looking at them as an option and I think that’s the big change,” Ms Conisbee said. “There has always been talk about retirees moving to the beach or bush, but the reality is a lot of young people are priced out of Melbourne.”

Younger buyers were also making the move to the Mornington Peninsula.

“Generally they’re focused around two things — value for money and a better area to bring their kids up with a focus on the outdoors,” Fletchers Mornington Peninsula director Josh Callaghan said.

But most buyers around Sorrento, Rye and Blairgowrie were “transitional”, setting up to retire in a few years and splitting their time between the coast and the big smoke.

“They’re looking for that permanent property where they’re perhaps selling the family home and will retain an apartment in the city,” he said.

 

Mornington Peninsula weathers a cooling market and signs point to a turnaround

The coastal market has had an "unprecedented number of visitors" and the premium and more expensive suburbs have faired better than those closer to Melbourne. The area is moving into traditionally the strongest selling season in February and Easter which is set to see the market do a turnaround.

 

Terry Ryder labelled regional Victoria as a whole “the strongest market in the nation, both for rising demand and big price growth”. Prices are still increasing in the outer, cheap areas of Melbourne like Frankston though.

Regional Victorian property market rising above the rest - realestate.com.au

 

City buyers driving sales in Mt Martha (Feb 2019)

Baby Boomers from inner city suburbs such as Hawthorn and Kew are driving demand. Properties are seeing 3-4 offers each and being listed for only a week or two. In 2019 the suburb is performing comparably strong to its performance in 2018.

'There were also more buyers who spent three or four days a week working in the city and lived on the peninsula the rest of the week, Warlimont & Nutt director Trent Cameron said.'

 

2016 top 10 largest victorian cities

1. Geelong 157,103
2. Ballarat 93,761
3. Bendigo 92,384
4. Shepparton 46,194
5. Wodonga 35,131
6. Mildura 33,445
7. Warrnambool 30,707
8. Wangaratta 28,310
9. Traralgon 25,482
10. Mornington 23,989

2035 top 10 largest victorian cities

1. Geelong 209,000
2. Bendigo 130,000
3. Ballarat 125,000
4. Shepparton 60,000
5. Wodonga 49,000
6. Mornington 43,500 (Mornington’s population will have almost doubled and become close to the same size as Shepparton’s population in 2016)
7. Mildura 41,700
8. Wangaratta 37,000
9. Warrnambool 36,300
10. Traralgon 29,000

Both Mornington and Wangaratta will grow larger than Warrnambool and Traralgon. Mornington will also surpass Mildura and Wangaratta. 2035 will also see Bendigo overtake Ballarat.

However, the inland rail project going through Wangaratta and Wodonga due for completion in 2024 will see these cities gain more momentum than projected in the mid 2020’s. This is as well as the Melbourne to Shepparton and Wodonga high speed rail projects supporting growth. The $235 million North East rail upgrade completed mid 2021 will also encourage growth in the area of Wangaratta and Wodonga in the short term.

Wangaratta’s population will grow by almost 29% at its projected growth rate. The city will continue to be the second fastest growing city in north-eastern Victoria.