Ski resort properties: your next investment?

Ski resortA ski chalet has long been seen as an essential part of a luxury property portfolio, with Elizabeth Taylor and Richard Burton’s Gstaad home probably one of the best-known examples. However, in addition to their indisputable status symbol credentials, ski resort properties are also increasingly considered to be one of the smartest long-term investments out there.

Although restricted planning permissions and considerably more demand than there is supply has sent the value of certain ski resorts – Gstaad included – soaring, investors who are prepared to look elsewhere will find a more than reasonable range of prices. Although luxurious mountain mansions are still available for those with the funds, Peter Frigo, a master licence partner at Engel & Völkers’ Switzerland office, observes that, “The spectrum of clients who buy high class real estate near the ski zones is very wide.” He lists young entrepreneurs, European families and even pensioners as some of the demographics that arrive seeking second homes in the area.

When it comes to choosing a ski resort, the famed European Alps and North American Rockies still reign supreme, with Verbier, Aspen and Whistler all highly desirable locations for investors. However, they’re far from the only options, with a few resorts emerging in recent years that could soon challenge the dominance of the older valleys. The mountains of Utah are a current favourite with the serious ski crowd, but have yet to attract the crowds of neighbouring Colorado. Bulgaria and other Eastern Bloc countries are currently putting considerable effort into developing their burgeoning ski resorts, while plans in India could see the Himalayas filling up with adventurous skiers in the next few years.

For the investors looking to enter the market in the near future, Switzerland remains probably the strongest and safest long-term option. In the first half of 2013 interest in Alpine properties grew by around 60%, with restricted supply driving the market forward and promising steady growth over the coming years. It might be expensive, but there is a certain grandeur associated with the Swiss ski scene and, as a short-term investment, a property in a Swiss resort should yield a guaranteed rental income between December and March.

The property market in Switzerland also makes it an appealing long-term prospect. Frigo observes that despite the various charms and advantages of other international resorts, the strength of the Swiss economy remains a deciding factor: “The financial crisis hasn’t had a negative influence on the complete Swiss real estate market. On the contrary, the Swiss market is characterised by stable, even lightly increasing prices, an excellent sales market, high quality real estate and no speculative property bubble.” The laws in Switzerland are also conducive to foreign ownership: the government has an annual quota of permits for non-resident foreigners, and exemptions to foreign ownership laws make it an attractive destination for investors – although there are restrictions on the size of property a non-Swiss couple can purchase alone.

For assistance in navigating this highly competitive but rewarding market, contact Engel & Völkers’ expert teams in Switzerland. With numerous offices across the country, we can offer localised advice along with an international outlook to ensure you find your perfect property.