Beach on a budget: Victorian coastal towns where homes cost under $1m

Victorians looking for a coastal home can buy properties for less than $1 million in a string of more affordable towns along the Bellarine, the Mornington Peninsula and beyond.

While a typical property in the prestigious beachside suburb of Sorrento will set buyers back upwards of $2 million, homes in nearby Tootgarook and Rosebud cost far less, with median house prices of $910,000 and $755,000, respectively, Domain data shows.

On the other side of the bay on the Bellarine Peninsula, a handful of beachside suburbs offer homes for less than $1 million, including St Leonards ($745,000), Portarlington ($880,500) and Ocean Grove ($970,000), offering more affordable alternatives to the Surf Coast towns of Anglesea ($1,467,5000) and Torquay ($1,207,500).

Domain head of research and economics Dr Nicola Powell said buyers looking for a coastal home could find larger properties and lower prices if they looked away from typical tourist hot spots to lesser-known beach locations.

“There are many factors that influence price. It will be location, the amenities, the community and the types of homes on offer,” Powell said.

Powell said while many coastal towns had recorded price falls since the lockdown-era sea change boom, house prices in sought-after areas with long-term holiday home owners remained high.

“We know those coastal locations saw extreme rates of price growth relative to Melbourne, but demand isn’t what it once was and we have seen a pullback in price … it’s moved away from those ferocious price increases that we had experienced,” she said.

“If [properties] are tightly held, that also helps to boost up the price because it means [the area] is really hard to get into. So when a property does come up, it’s highly fought over.”

Alexander Selway, 28, decided to buy land and build a house in Ocean Grove, where the median house price is $970,000.

Selway, a real estate agent from Geelong, and his partner Olivia wanted to live closer to the beach but quickly realised popular towns such as Torquay and Barwon Heads were too expensive.

“We looked at Torquay as well, but we found in Ocean Grove, you could get a lot more for your money,” Selway said. “For a premium kind of suburb, it was still very competitively priced.”

Selway added that buying a home further away from the waterfront helped bring down the price.

He said: “If you’re within a few streets of the beach in Ocean Grove, you’d probably be paying about $2 million or $3 million. This one’s a little bit further back, but still the same suburb.”

Selway’s mortgage broker Matt Turner, of Geelong Surf Coast Finance Solutions, said buyers looking for a beach house could get more value for money if they considered buying in lesser-known areas or growth corridors.

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He added that while many buyers had their hearts set on the Surf Coast, which included Torquay and Anglesea, buyers might be able to find more “bang for their buck” if they turned to the neighbouring Bellarine Peninsula instead.

“We do have to talk [to clients] about potential compromise in location and postcode to allow them to have the type of property that they want, but in saying that it’s difficult to talk someone away from the Surf Coast,” he said.

“You can certainly get a really good property on the Bellarine in somewhere like Drysdale, that’s still five minutes from the beach.”

The median house price in Drysdale is $720,000.

Turner said he had noticed a downturn in holiday home purchasers over the past year following tax changes for second homes, but maintained the Bellarine had become a popular destination for buyers looking for a coastal property.

Turner said he had seen a lot of first home buyers priced out of the Surf Coast looking to purchase in Bellarine towns such as Drysdale and Curlewis, both within proximity of the beach, where there were new housing developments being built.

For buyers keen to buy on the other side of the bay, they might consider looking beyond the Mornington Peninsula to South Gippsland, where homes cost a median of $592,500 in Venus Bay and $890,000 in Inverloch.

Ray White Inverloch principal agent Fiona McMahon-Hughes said buyers could find large properties, beach lifestyle and fewer crowds than on the Mornington Peninsula, within a two and a half hour drive from the CBD.

“Venus Bay and Inverloch are very much entry level and are at that sweet spot out of Melbourne,” she said.

McMahon-Hughes added some buyers priced out of the Mornington Peninsula had turned to Inverloch and its surrounding areas, where they could get more value for money while still having access to surf beaches and local amenities.