According to a recent Ski Resort Property Index research from London-based Knight Frank, luxury holiday home sales in selected affluent ski regions in Europe are on the rise.
Liam Bailey, Head of Residential Research at Knight Frank, says, "The debut of Knight Frank's Ski Resort Property Index is something I'm very excited about. For the first time, the Index will provide sellers, buyers, and those with an interest in these specialized but growing areas with information on the performance of their luxury property market.
Findings of importance:
The French town of Megève experienced a rather robust rebound in property prices, with a 4.3 percent increase in the year to June 2011, however values are still 4-6 percent below 2008 levels.
Despite the fact that prices in the US resorts of Telluride and South Lake Tahoe fell annually, there is evidence that both markets are strengthening, with both experiencing a reduced pace of quarterly price drops in Q2 2011.
In 2009, the effects of the global recession were initially felt in European resorts. Prices have now steadied in most Alpine destinations, with some, but not all, witnessing slight price increases. Although the market remains price sensitive, well priced houses continue to sell and, on occasion, attract multiple bidders.
In Q2 2011, the average annual price growth in Europe was 1.7 percent, compared to -3.0 percent in North America.
Demand from Eurozone buyers has maintained price growth in the French Alps positive, displacing buyers from Russia and the Commonwealth of Independent States, whose presence has waned since 2009.
Many of the world's finest ski resorts are seeing reduced seasonal demand for property. Summer tourism, which often includes hiking and climbing, has helped many second-home owners raise their rental profits, particularly in the Alps.
"A number of variables have contributed to the stabilization and, in some cases, recovery of prices in the French Alps. Many French ski resorts are situated at a high altitude, making them (on average) more snowfall reliable. In the Austrian Alps, a chalet above 1,600m can be difficult to find. Furthermore, the French resorts are well-established, with the most of them offering a variety of sports and activities in addition to skiing, not to mention a diverse gastronomic offering. The French resorts have also benefited from major investment in the previous five years, resulting in the highest-quality skiing, accessibility, and infrastructure in the world. Courchevel is an excellent example of how the resort's ski lifts and snow cannons are improved year after year.
"In terms of sales activity, the traditionally popular resorts of Courchevel, Megève, and Val d'Isere continue to top the market. The Belvedere and Routes des Chalets/Le Reynard in Méribel, as well as the Belvedere and Routes des Chalets/Le Reynard in Courchevel 1850, Mont d'Arbois in Megève, and the Belvedere and Routes des Chalets/Le Reynard in Méribel, are all excellent examples of key sub-markets within the resorts that generate the most interest from buyers.
"Buyers from the United Kingdom, who account for 35-40% of prime property purchases in the French Alps, have found themselves up against more Eurozone, and particularly Italian, buyers who were unaffected by currency swings throughout the global economic collapse. During the 2010/11 season, Eurozone buyers remained prominent, and this increased demand meant that some more conservative UK buyers saw their preferred property sold before they were able to commit to it.
"Many of the world's finest ski destinations are seeing reduced seasonal demand for property. Summer tourism, which often includes hiking and climbing, has helped many second-home owners raise their rental profits, particularly in the Alps. Summer festivals, concerts, and sporting events are now held throughout the Alps, attracting visitors all year.
"While prices have not risen across the board (and markets remain price sensitive), activity (particularly viewings) has surged in the top mountain resorts.
"The 2010/2011 season proved to be surprisingly robust, with a solid level of sales activity in the French mountain resorts," says Matthew Hodder-Williams, Head of the French Desk at Knight Frank. The greatest houses in Courchevel, Méribel, Megève, and Val d'Isere drew attention from multiple buyers, allowing sales to be completed at or near the asking price.
"Stock levels remain relatively low," Hodder-Williams says, "but new chalet constructions have provided a new level of quality and elegance to the resorts and compare favorably with those that have been available since before the start of the 2010/2011 season."