Victorian Alps property market: snow holiday homes in demand
One month into the coldest season of the year and winter is living up to its expectations.
The rain, wind and freezing temperatures across Melbourne have some people dreaming of summer and others making the trek to the Victorian Alps for the snow season.
If you are the latter, what better time is there to think about buying a property in the snow?
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While Melbourne’s property market has struggled the past year, the alpine market has not.
If anything, it has got stronger, according to Castran managing director John Castran.
Mr Castran said a snow holiday house could well be the new beach house, with more buyers becoming interested.
“Beach houses are getting more expensive and you can use snow houses in the summer as well,” he said.
“All of the resorts have seen significant visitation increases (in the warmer months), especially in Falls Creek because of mountain bike riding.”
However, buying a property in the snowfields is a little bit different to anywhere else, as you buy a leasehold title because it is crown land.
This can impact obtaining finance.
Wakelin Property Advisory director Jarrod McCabe said finance was a significant factor to take into account when looking at buying a property at Mt Buller, Mt Hotham and Falls Creek.
“You need to talk to someone with an understanding of a leasehold agreement, to see how much you will be able to borrow, and a solicitor that is familiar with that type of contract of sale,” Mr McCabe said.
“It is difficult enough at the moment getting finance to buy a standard freehold house.”
He said buying property on the mountains might look attractive and affordable but there were many things to factor in, including owner’s corporation fees.
Mr McCabe said it was a lifestyle decision to buy in the snow, not an investment.
“Buyers want something low-maintenance with some sort of outlook. A fireplace and parking are also highly sought after,” he said.
Mr Castran said the hold period for property in Victoria’s alpine region was about 10-15 years.
A massive injection of money in the past 12 months has seen Mt Buller undergo a transformation.
The new six-seater detachable chairlift Bourke Street Express is now operating and the redevelopment of Kooroora has started.
In October last year, the 1953 building was demolished and the new development is now taking shape.
Mr Castran said the renowned Kooroora Hotel had been built into the building along with a nightclub, completing stage one, which opened recently.
“The crane will come back in October and put up an additional five levels.”
At completion there will be 38 apartments, basement parking and retail and commercial spaces.
Mr Castran sold 35 apartments in 10 months ranging in price from $260,000-$5.3 million.
Another new development at Mt Buller is Whitehorse Village. It is an exclusive drive-in, ski-out village made up of large chalets ranging in price from $2.7-$2.85 million.
Mr Castran said there was only one left for sale.
“The real estate market at Mt Buller has sold more than Falls Creek, Mt Hotham, Dinner Plain and Thredbo combined,” he said.
“It is out of control, the demand is so strong. There is so little land left for sale, you have to knock things down to create new developments.”
Mr Castran said Mt Buller did not feel the effects of the fall Melbourne had in the past year.
“It has got stronger. I have never seen anything like it,” he said.
“It is in the must-have-bag of real estate for the higher socio-economic group.”
He said prices had gone up about 50 per cent in the past two years.
Generally, studio apartments sold from $250,000-$350,000, one-bedroom $400,000-$500,000, two-bedroom $650,000-$900,000 and three-bedroom $950,000-$1.5 million.
Mr McCabe said Mt Buller had the greatest buyer demand because it was the closest to Melbourne’s CBD, at about 250km.
FALLS CREEK AND MT HOTHAM
US snow resort operator Vail Resorts recently paid $174 million to buy Victoria’s largest snowfields, Falls Creek and Hotham Alpine resorts, from Merlin Entertainments.
The deal includes the ski school, retail, rental, reservation and property management operations at both resorts, which are almost 400km from Melbourne’s CBD.
Mr Castran said growth in Australian resorts was strong because of the growth in immigration.
“Emerging growth is from the Chinese and Indian market. Every other resort in the world has stabilised its growth,” he said.
“Australia is growing rapidly because of the population growth of Melbourne and Sydney, plus the proximity to Asia.”
He said there were no buyers from China or India five years ago, but now they made up 10-15 per cent of the market — and growing.
“Vail Resorts will announce at the end of the season its future plans for Mt Hotham and Falls Creek,” he said.
Property sales in Dinner Plain are strong as the land is freehold, unlike the other alpine areas where it is leasehold land.
Mr Castran said sales there had been “absolutely fantastic”. “We sold about 30 houses last ski season to the Wyndham hotel chain,” he said.
The global hotel behemoth took a $20 million stake in the boutique Peppers Resort and multiple individual homes at Dinner Plain.
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