The second home market in St. Moritz is experiencing an upswing. When it comes to properties in the best locations, Engel & Völkers recorded a price rise of 3 percent in the second half of 2014 compared to the same period the previous year. The reason for this is a growing demand for high quality properties from overseas buyers within Europe. “Although the market was relatively quiet in the first half of 2014 and we were facing the second homes initiative, prices in the second half of the year have risen to a very high level. At present there is a lot of movement within the market, as there are rather more portfolio properties listed than usual. In the short term this represents a good investment opportunity for buyers”, says Eddy Derksen, Managing Partner of Engel & Völkers in St. Moritz.
The second homes initiative agreed in March 2012 will in future lead to a shorter supply of holiday properties. The initiative limits the number of second homes to 20 percent of the total property stocks; a percentage which has already been reached without exception in the communities of the Upper Engadine. This means that at present no new holiday properties can be built in St. Moritz. Once the second homes initiative comes into force Engel & Völkers expects to see further price increases in the medium term.
The Suvretta-Hang hillside is the most desirable address
One of the best locations in St. Moritz is still the Suvretta-Hang hillside. The Via Suvretta continues to record the highest prices per square metre. Here exclusive villas in traditional chalet style with particularly high quality features change hands for 25,000 to 35,000 euros per square metre. Some exceptional premium properties on the Suvretta-Hang, where everything from the micro-location to the fixtures and fittings is as good as it gets, have fetched prices of up to 40,000 euros per square metre. However, according to Eddy Derksen, “such trophy properties seldom come up for sale”.
Property prices are also running at a high level above the village of St. Moritz in good locations such as the Via Tinus, Via Brattas and Via Serlas. For chalets and apartments, the price per square metre in these locations reaches 15,000 to 25,000 euros. Surrounding communities, such as Sils, Silvaplana, Pontresina, Celerina, Samedan and Zuoz, are benefitting from the popularity of the ski resort. The municipality of Sils, for example, achieves prices of up to 20,000 euros and in Pontresina up to 18,000 euros per square metre.
International buyers dominate the second home market
Potential buyers look for high quality second homes in St. Moritz, both for their own use and as a capital investment that will hold its value. Most of the purchase requests come from customers in Germany, Switzerland, Italy, the Benelux countries and England as well as Russia and China. “The current high international demand for second homes in St. Moritz brings great stability to the market. Most buyers often finance their properties with a high percentage of their own capital”, explains Eddy Derksen. The most sought-after properties in St. Moritz are chalets in typical Engadine style and modern apartments. A key factor in the choice of property, along with a central but quiet location, is the orientation with an unparalleled panoramic view.
The average marketing time for second homes in good and very good locations has lengthened slightly in the last two years. “The prices that buyers and sellers expect to get are somewhat further apart than before. This may change again in the coming months”, says Eddy Derksen.
Outlook: The market continues to show dynamic growth
In 2015 the second home market in St. Moritz will continue to show dynamic growth, in the view of Engel & Völkers. “We assume that the overseas demand for first class properties will continue to rise and that this will lead to a steady increase in prices. Investors still have a high degree of confidence in the ability of their investments to hold their value”, says Eddy Derksen.
St. Moritz is one of the world’s most exclusive ski resorts. The town in the Canton of Graubünden boasts 350 kilometres of pistes, 322 days of sunshine per year and good snow conditions from December to April, making it an ideal destination for winter sports enthusiasts. In the summer months, too, the region is a popular destination for international guests as it offers numerous walking and cycling trails, golf courses and Lake St. Moritz. “These and many other attractive highlights in the year are crucial elements of the excellent reputation enjoyed by St. Moritz around the world”, continues Eddy Derksen.
In the winter of 2014/2015 St. Moritz is celebrating 150 years of winter sports tourism with a spectacular Light & Snow presentation by light artist and event designer Gerry Hofstetter. Numerous events such as guest rides on historic and modern bobs or the Monaco Historic Race on the Olympia Bob Run attract many visitors to St. Moritz. In addition, the White Turf horse race, the FIS Alpine Ski World Cup, the Snow Polo World Cup as well as the Gourmet Festival are among the highlights in the popular winter sports resort. “St. Moritz will therefore remain sought-after as a second home market among property buyers when it comes to future second home ownership”, Eddy Derksen concludes.