Margaret River is famous worldwide for wine, surf and idyllic holidays. But a dark pall has been cast over the West Australian town, which is now the home to one of Australia's worst mass murders.

Photo: Australian Police

Locals have been left struggling to understand how their tight community could be ripped apart by the massacre of a family of seven, including four young children aged between eight and 13.

Early yesterday morning, news spread like wildfire through the town of 9,000 that a serious crime had occurred.

In the nearby area of Osmington, about 20 minutes from the Margaret River township, neighbour Felicity Haynes had been woken just before 5:00am by what sounded like gunshots, but assumed it was kangaroo shooters getting an early start.

Around the same time, police received a triple-0 call from a man who has not been identified, prompting officers to swarm on a peaceful-looking property on Osmington Road.

West Australian Police Commissioner Chris Dawson held a snap press conference a few hours later to confirm seven people had been killed in what appeared to be a murder-suicide on the property.

By Friday night, detectives had not yet formally identified those killed, only saying they all appeared to be residents at the property.

But a family friend confirmed to the ABC the dead are Katrina Miles, her four children, and her parents Peter and Cynda Miles.

Mr Dawson said the property consisted of an established house and a shed that had been converted to living quarters. It was inside this shed that one of the adults and the four children were found dead.

The Miles family were active members of the local community, with Cynda Miles hosting sewing bees at the Osmington Road property.

The owner of the farm next door, Neil Garnett, said the news was so appalling it did not seem real.

"Seven people is just shocking," he said.

"It just seems too weird, it's a beautiful sunny autumn day and here we are under these circumstances.

"We live in a beautiful sleepy part of Margaret River and the last thing you would expect is something like this."

Mr Garnett said he was feeling helpless and at a loss on hearing the news, so he cooked sausages and brought them with bread and sauce to the police officers manning the roadblock, which will likely remain in place on his street for days to come.

He said the community had never seen anything like it.

"It's about the sleepiest place you can get. We all know each other, we have a great community and we're just trying to absorb this.

"We will overcome it of course, but it has shaken us to the core."

Dozens of Homicide Squad Detectives and forensic investigators remain at the rural property on Osmington Road.

They have been joined by dozens of media crews, with the story attracting global headlines.

Police Commissioner Chris Dawson said support services will be made available for the local police officers, who were met with a horrific scene when they arrived at the property.

What they found was the bodies of two adults outside, and another adult and four children inside the converted shed.

Helicopter footage showed one of the bodies was found slumped in an armchair on the verandah.

Two firearms were also located at the scene.

It is the worst mass shooting in Australia since the Port Arthur massacre in 1996, in which 35 people were killed and another 23 seriously injured by lone gunman Martin Bryant.

That incident was so shocking it ushered in tight gun control laws that have been held up as a global standard for preventing gun violence.

In a town where police are rarely seen or needed, disbelief is mixing with shock and grief as the reality of the horrendous crime sinks in on the people of Margaret River.

"My reaction is one of absolute disbelief - a whole family gone like that," said neighbour Felicity Haynes.

"They were my neighbours, I knew them well and loved them dearly."

The Augusta-Margaret River Shire is trying to pull the community together, offering professional support services at the Margaret River Community Centre on Tunbridge Street and encouraging people to leave flowers there as a tribute.

Shire President Pam Townshend said this would offer an opportunity for people to get help or simply come together to grieve.

"This incident has shocked our local community to the core and as a small and close-knit community, many people are likely to know or be connected in some way to the deceased," she said.

"It's a small rural community so everybody is connected to everybody."

"It's horrific, it's sent a shock wave and the ripple effect will continue right through our community for a long time."

- ABC

Where to get help:

Need to Talk? Free call or text 1737 any time to speak to a trained counsellor, for any reason.

Lifeline: 0800 543 354 or text HELP to 4357

Suicide Crisis Helpline: 0508 828 865 / 0508 TAUTOKO (24/7). This is a service for people who may be thinking about suicide, or those who are concerned about family or friends.

Depression Helpline: 0800 111 757 (24/7)

Samaritans: 0800 726 666 (24/7)

Youthline: 0800 376 633 (24/7) or free text 234 (8am-12am), or email talk@youthline.co.nz

What's Up: online chat (7pm-10pm) or 0800 WHATSUP / 0800 9428 787 children's helpline (1pm-10pm weekdays, 3pm-10pm weekends)

Kidsline (ages 5-18): 0800 543 754 (24/7)

Rural Support Trust Helpline: 0800 787 254

Healthline: 0800 611 116

Rainbow Youth: (09) 376 4155

If it is an emergency and you feel like you or someone else is at risk, call 111.