The Market
Why Mornington Peninsula is One of the World's Premier STR Markets
Victoria charges a short stay levy and the Mornington Peninsula is where it bites hardest. Under the Short Stay Levy Act 2024, a levy of 7.5% of the total accommodation fee applies to stays of fewer than twenty-eight consecutive days, on bookings made on or after 1 January 2025. There is no statewide night cap — the levy is the state's chosen instrument rather than a day limit — but the same Act amended the Owners Corporations Act 2006 so that an owners corporation can now ban short stays outright by special resolution of seventy-five per cent of lot owners, with the exception that such a rule cannot apply to a lot that is the owner's or occupier's principal place of residence. For anyone buying an apartment or a unit on this peninsula, that is a material risk that did not exist three years ago. On top of the state layer, Mornington Peninsula Shire Council runs its own short-stay rental registration process with a code of conduct and fines for breaches, so confirm the current local requirements for your specific address. What all of that sits on is Melbourne's weekend playground: an hour from the city, two coastlines, hot springs, wineries and some of the most expensive holiday real estate in Australia.
The Mornington Peninsula is a Melbourne market and it behaves like one. An hour or so from the city puts Mornington, Mount Martha and Dromana within easy weekend reach and Sorrento, Portsea, Flinders and Cape Schanck within comfortable range, and the demand shape follows: two- and three-night weekends dominate, summer is extraordinary and the rest of the year depends entirely on whether an operator has built anything for it. The peninsula's structure is unusual and commercially useful. The bay side — the front beaches — is calm, swimmable and family-oriented, with piers, bathing boxes and the Sorrento to Queenscliff ferry. The ocean side — the back beaches — is Bass Strait surf, cliffs and walking tracks, sometimes only two or three kilometres away across the same peninsula. Inland sits Red Hill and the cool-climate wine country producing serious pinot noir and chardonnay, plus a food economy that runs year-round. Peninsula Hot Springs has done more than anything else to build a genuine winter product. Blended nightly rates run near A$358 with occupancy around 52% — the highest average rate in this batch against modest occupancy, which is what an intensely seasonal market close to a capital city looks like.
Top Attractions & Landmarks
- Peninsula Hot Springs
- Sorrento and Portsea front beaches
- The Bass Strait back beaches and the Cape Schanck lighthouse
- Red Hill and the peninsula wineries
- Point Nepean National Park
- Arthurs Seat and the Eagle gondola
- The Sorrento to Queenscliff ferry
Nearby Markets: Great Ocean Road | Barossa Valley | Snowy Mountains