Prime property prices have fallen in key ski resorts worldwide
Prime property prices in key ski resorts worldwide have fallen 9.1% since their peak in the third quarter of 2008, according to the latest ski property index from Knight Frank.
The index report says that the global financial crisis has dented buyer confidence in some of the newer resorts but long established core markets such as Courchevel and Aspen have benefited from renewed interest.
As a result the index has largely plateaued since 2010 with prices remaining static or rising marginally in the best resorts due to tight supply.
Swiss resorts have seen the biggest increase in prices in the second quarter with prime property in Zermatt up 18% compared to the second quarter of 2011. Gstadd has seen prices rise 13.2% over the same period and Verbier 8.8%.
At the other end of the scale prices in Whistler, Canada, were down 13% in the second quarter of 2012 compared with the same quarter of 2011 and prices fell by 12.5% in South Lake Tahoe in the US and by 10% in Chamonix in France.
A number of resorts, including Aspen in the US, Courcheval in France and Revelstoke in Canada have seen prices remain flat.
However, in line with forecasts that the number of individuals worth US$100 million or more will increase from 63,000 to 86,000 between 2011 and 2016, demand for homes in the world’s best ski resorts is expected to strengthen.
This view is further enhanced by a recent survey, conducted by Knight Frank, which found that 38% of ultra high net worth individuals (UHNWI) in the United States or Canada either own or would be interested in owning a ski home. Additionally, 11% of both Latin American and Asian UHNWIs also expressed an interest in ski property.
Mainland Chinese buyers are now evident in Whistler alongside the usual purchasers from Vancouver and Seattle. Brazilian and Australian buyers have been noted in Aspen alongside UK and Canadian buyers and owners.
Matthew Hodder-Williams, Knight Frank’s French Alps expert, said that demand for prime property in France’s top ski resorts held firm in the 2011/2012 season, in spite of a weakening Euro.
‘The weakening Euro has had little impact on pricing or the volume of sales in the French Alps. British, French, Ukrainian and Swiss buyers have been active in 2012. We are gearing up for the 2012/2013 season and hoping for another record year of snow,’ he explained.
‘I expect prices and activity to mirror last season with four bedroom chalets attracting the most interest and the four resorts of Courchevel, known as Courchevel Le Praz, Courchevel Village, Courchevel Moriond and Courchevel, generating the highest levels of enquiries,’ he added.
In Switzerland prices rose in many resorts in the year to June 2012. However, many resorts are now largely in limbo as clarification is sought on impending tax and legislative changes.
In March 2012 Swiss residents approved by referendum a new law, which aims to ban new secondary residences in Swiss municipalities where the level is already above 20%. The Swiss Cabinet has recently delayed the law’s introduction from September 2012 to January 2013 and reports suggest large loopholes may be incorporated. Resort developments, for example, may be permitted, provided they ensure year round use by tourists.
Hodder-Williams said that sales activity is expected to recover from the current lows once the full legislation has been published but some foresee a surge of planning applications by developers in the interim.
Investors are interested in ski in/ski out homes which are easily rentable while lifestyle purchasers place higher value on views, accessibility and a resort’s facilities.