Devastated residents of Victorian coastal towns Wye River and Separation Creek have returned to inspect the damage caused by the Christmas Day bushfires, as authorities warn of fresh fires on New Year’s Eve.

The Country Fire Authority (CFA) said 116 homes were destroyed by the fire, now under control, which burned 2300 hectares and blackened large parts of the Great Ocean Road.

But authorities praised local volunteers for preventing an even bigger disaster.

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Emergency Management Commissioner Craig Lapsley said more homes could have been lost if not for a 30-year-old fire plan.

“I would have thought they would have lost at least 200 homes in this town,” Emergency Management Commissioner Craig Lapsley told reporters on Sunday.

“This brigade, this community, actually had a community plan that had planned for many years about a fire coming into Wye River. This is not new to them.”

Wye River locals were bussed in to survey their properties on Sunday morning, while those from Separation Creek were given a tour of their community on Saturday afternoon.

A State Control Centre spokesman warned that the under-control blazes could flare up again on New Year’s Eve.

“There is concern that the fire will become more active on Thursday, when fire rating is due to be severe on New Year’s Eve,” the spokesman told AAP.

Wye River and Separation Creek residents hear news of the devastation. Photo: AAP

The usually bustling Lorne was deserted after bushfires destroyed houses in nearby towns. Photo: AAP

On one hill in Wye River, a cluster of homes has been destroyed, while others nearby still stand among green trees.

Burnt-out cars have also been found in the fire ground.

There was not just direct damage from fire, with fallen trees, downed power lines and other hazards causing problems.

Buildings reduced to piles of rubble among the burned trees, blackened ground and smouldering ruins. Photo: Getty

The bushfire at Wye River near Lorne. Photo: AAP

Many trees that need urgent removal have been marked in yellow paint.

Commander Barry Jones from the Department of Environment, Land, Water and Planning (DELWP) said the priority was making the area safe enough to begin the clean up.

He said it would be an extended amount of time before residents would be able to return permanently.

The Insurance Council of Australia estimate initial insurance losses at $25 million.

Officers from DELWP said recent rain had actually made the clean-up effort harder, with conditions too slippery for some of the heavy machinery.

Risk assessment teams have been inspecting properties for damaged power lines and other issues such as asbestos.

The remains of a building destroyed in the bushfire at Wye River. Photo: ABC

Return visit ‘traumatic’ for some locals

Speaking from Wye River, Mr Lapsley said there was a total of 334 homes in Wye River and more homes could have been lost if not for the town’s fire plan, which was first written in 1984.

“The community really have appreciated the fact they can come back and have a look [at the damage], that’s traumatic in its own right,” he said.

“You think about losing all your property and coming in and not knowing what you’re going to see.”

So it’s bye to Wye …. Very sad to say goodbye to this sweet little house, and my favourite holiday escape that holds so many fond memories of family and friends. Thinking especially of my Aunty, Uncle and Cousins 💕

A photo posted by Chloe Nott (@cejn) on Dec 26, 2015 at 3:39pm PST

Assistant chief officer Bob Barry from the CFA said local fire crews prepared well in advance of the fire reaching the towns.

“We door-knocked the homes here. We put an evacuation plan in place with Victoria police, and a risk and consequence plan in place in the lead up.

“All that planning came together on Christmas Day. The evacuation couldn’t have gone any better.”

Anna Cuttriss of Department of Environment, Land, Water and Planning inspects a destroyed car in Wye River. Photo: Getty

Wreckage left behind by the destructive Black Christmas bushfires, which razed hundreds of homes. Photo: Getty

Captain of the Wye River brigade Roy Moriarty said locals knew the bushfire would be “pretty mean”.

“I did expect three times more than that to go, at least. It’s really only the ones deep up in the ridge that have gone,” he said.

“We were actually in overalls down here [on Christmas Day] before the sirens had gone off.”

Loss of tourism, visitors a blow for region: Mayor

Great Ocean Road Regional Tourism chairman Wayne Kayler-Thomson said the Christmas Day bushfire had significantly affected the area’s most profitable time of the year.

“To put it in context, the Great Ocean Road region is the most visited outside Melbourne,” he told AAP on Monday.

Mr Kayler-Thomson said the Surf Coast and Colac-Otways shires, from Torquay to past Cape Otway, get 50 per cent of their total visits in the summer period, leaving accommodation, food and retail businesses with losses of 30 per cent.

“All these businesses rely on this time of year to carry them through the rest of the year,” Mr Kayler-Thomson said.

Despite not being directly affected by the bushfires, Apollo Bay’s location means it has suffered the most out of all coastal towns in the area, he said.

Burnt out trees near the Great Ocean Rd in Victoria. Photo: AAP

Secretary of Apollo Bay Chamber of Commerce Jo Birley says Apollo Bay’s location to the west of the Ocean Road road closures means people are not coming through the town.

“Apollo Bay hasn’t been affected; people just have to take an alternate route through an unaffected part of the Otways to get here, which is quite beautiful,” Ms Birley said.

Pubs that usually pre-book up to 200 meals per day from tourists are standing empty, and shops are being forced to lay off casual workers hired specifically for the post-Boxing Day tourist influx.

“These are days businesses can turn over $10,000 to $15,000, so they’ve put on extra staff,” Ms Birley told AAP.

“They’ve been prepared for massive numbers so they’re losing most of their money in wages.”

Crews working hard ahead of new year hot spell

Watch and act alerts are still in place for Wye River and Separation Creek.

Warnings for Lorne, Kennett River and Grey River have been downgraded to advice level.

CFA captain Roy Moriarty (C), pictured with Andrew Hack {L) and Ian Wells, said locals knew the fire would be “pretty mean”. Photo: AAP

Wye River residents have returned to scenes like this. Photo: AAP

The CFA said while the immediate threat had passed, the bushfire was not yet under control and burning outside containment lines.

Locals and holidaymakers have been urged to stay vigilant in the coming weeks.

Crews have been trying to take advantage of cooler conditions before warmer weather hits later in the week. The fire danger rating will rise again on New Year’s Eve when it hits 37C.

But incident controller Peter West said crews would be fighting the blaze for the entire summer.

“We will go through another warming cycle around new year’s, so we want to do as much work as we can before that,” he said.

“This is a little bit of a danger time when the adrenalin is there, while the action’s on.

“While things are quieter now we have to ensure people are very aware of their own safety.”

-with ABC/AAP