Selling a holiday home in 2026 involves navigating increased supply and downward price pressure caused by the Short Stay Accommodation Levy and higher Emergency Services Levy costs for non-principal residences. Permanent residences remain more stable, supported by a tight 0.6% vacancy rate and strong owner-occupier stability.
The primary divide in the 2026 market is regulatory. While permanent residences are insulated from short-stay legislation, holiday homes are seeing a surge in listings as investors exit due to tax and levy pressures.
How does the Short Stay Levy affect sales?
Hosts earning under $75,000 per year were required to register by 30 January 2026, while those above this threshold face quarterly lodgments. From 1 July 2026, non-principal place of residence properties face increased fixed charges for the Emergency Services Levy. These costs are prompting some owners to divest their holiday holdings.
Why is supply increasing for holiday homes?
Listings in Rye, Rosebud, and Dromana are currently dominated by ex-rental properties being disposed of due to interest rates and land tax (Barry Plant Dromana, early 2026). This increased supply of holiday-rental properties returning to the sales market is creating downward pressure in these specific segments.
What is the current price trend for Peninsula properties?
Properties priced above $1 million are selling well and often exceeding expectations (Barry Plant Dromana, early 2026). Conversely, entry-level properties below $1 million are adjusting from previous peaks, which is creating value opportunities for buyers as the market corrects.
The appraisal spread
There is a widening gap between the performance of high-end luxury homes and entry-level holiday rentals. Predicting the bottom of the price correction for the sub-$1 million segment remains difficult as the market continues to absorb new supply from exiting investors.
| Suburb | Median House Price | Annual Growth |
|---|---|---|
| Mt Eliza | $1,692,000 | +0.9% |
| Safety Beach | $1,160,700 | +0.3% |
| St Andrew’s Beach | $1,593,700 | +0.5% |
Frequently asked questions
Should I sell my holiday home before July 2026?
From 1 July 2026, the fixed charge component of the Emergency Services Levy increases for properties that are not a principal place of residence. Owners of holiday homes and investment properties should factor these increased holding costs into their decision on whether to sell or hold.
How long does it take to sell a house in Mornington?
The median days on market in Mornington is between 36 and 38 days (CoreLogic/OpenAgent, March 2026). This is faster than the Victorian median of 42 days, suggesting sustained momentum in the area’s “Accelerating Growth” phase (HtAG Analytics, March 2026).
Are units a better investment than houses on the Peninsula?
In Mornington, units have shown annual growth of +8.8% (OpenAgent) and are selling faster than houses, with a median of 30 days compared to 38 days for houses. This indicates stronger short-term demand for lower-maintenance dwellings.
What is driving buyer demand in the Mornington area?
Demand is driven by a tight 0.6% vacancy rate and a dual buyer pool of Melbourne weekenders and permanent residents, particularly those aged 70–79. Coastal lifestyle assets like wineries, golf courses, and beaches continue to attract significant interest.
Questions to ask your agent
- How does the recent increase in ex-rental listings in Rosebud specifically impact the appraisal of my property?
- Given my property is below $1 million, what comparable sales from the first quarter of 2026 support the current pricing strategy?
- How is the current “Accelerating Growth” phase in Mornington affecting buyer behavior for non-principal residences?
This article contains general market information based on data current as at April 2026. It does not constitute financial, legal, or real estate advice specific to your property or circumstances. For an appraisal and tailored advice, speak with a Fletchers agent in your area.