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With snow finally arriving across the French Alps a flurry of interest is expected in ski property, especially since interest rates offered by lenders in France are so low.

Rates below 3% were available in 2014 and the beginning of 2015 may herald even lower rates in France as the long term outlook for growth in Europe remains weak, according to John Busby, private clients director of French Private Finance.

He pointed out that the TEC 10 index dropped below 1% for the first time in December, hitting 0.86%. ‘It is worth stressing again that this is now the rate investors will receive when lending to the French Government for a 10 year period. Hopefully this drop will continue to make it through to retail mortgage rates and so buyers will continue to benefit, said Busby.

He also pointed out that it seems that the controversial social charges of 15.5% which were added to French capital gains and rental income tax are in fact illegal under European law and many people who sold a property during 2014 are now making cases to reclaim the tax which they have overpaid.

‘This is also reassuring news for those looking to buy over the busy ski property season,’ added Busby.

According to Francois Marchand, general manager at Erna Low Property, the ever lower interest rates offered by the French Banks and a weakening Euro versus the Sterling has triggered earlier property searching by clients in the French Alps.

‘Enquiries from savvy investors are up 20% year on year since the end of the summer. Site visits have been taking place since the beginning of September,’ he said.

He explained that over the past 12 months, many exciting new developments have appeared in the French Alps with a few new hot spots for investors for example Châtel, part of the Portes du Soleil ski area. Erna Low Property has sourced a few new property developments ready for this ski season or for next December 2015 with leaseback options.

Les Gets, also part of the Portes du Soleil and a short drive from Geneva Airport, having  been short of new property developments for sale for a few years, due to a need to upgrade the draining systems and water supplies, now has a greater variety of new properties for sale.

Tignes les Brevieres has long been popular for its flexible leaseback investment with the British market, with direct access to the world renowned Espace Killy ski domain and in the same ski area, La Plagne has a new leaseback property investment, ski-in ski-out, of fully furnished apartments ready in December 2016.

‘Over the past two years, we have experienced a great increase in activity levels, the winter season has started in the middle of summer for us, which is something we last saw in 2008,’ said James Ross, sales manager at Erna Low Property .

‘It appears that the French Alps is enjoying a renaissance as a favourite destination for first time investors in France, and we are very well prepared for this activity,’ he added.

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The market for ski property in the Alps is gaining momentum with prices stabilising following falls in both 2011 and 2012, according to a new analysis report.

Both viewings and transactions increased in 2013 while both were up again by 200% in January and February of 2014, the report from a renowned international property firm shows.

It says that the majority of Alpine property buyers are regular skiers in the region, and although the number of winter ski trips to the Alps are still below their 2007 to 2008 peak when 700,000 trips were made, winter visitors have started to increase again.

The residential markets are also aided by growth in summer season visits, as the mountains attract larger numbers of walkers and cyclists.

The report points out that Switzerland’s status as a safe haven with its attractive fiscal environment and historical political and economic stability, make it an attraction for buyers from around the world.

International buyers are diverse, but the Swiss Alps have seen purchasers from Asia, in particular Singapore, and young buyers who are on average in their early 40s. Buyers from northern Europe are also on the increase in the Swiss Alps.

‘The rental market is strong, so renting out a property for just three weeks a year in Verbier, for example, will usually completely cover the annual running costs of the property,’ the report says.

‘Apartments are popular, especially new build properties which can provide a range of attractive offerings such as proximity to lifts, parking, wellness centres and concierge services,’ it adds.

In scenic Austria where ski resorts and lakes are often close together, dual season properties are popular. Lower capital values in this market have meant buyers can find good, income producing investments.

New developments are underway in many resorts, so supply is not as constrained as in some other Alpine locations, especially Switzerland. Chalets remain popular and relatively affordable in Austria.

UK buyers are the biggest buyer group in Austria although the country is also popular with those from the Czech Republic, Russia and other countries in the CIS.

The French Alps have seen a mixed picture in terms of pricing. Where Courchevel has seen prices stabilise at 20% below 2008 values, limited supply has helped both Megève and Val d’Isère see sustained price growth over the five years to 2013.

‘As with the rest of France, confidence in the market is still relatively weak, impacted by ongoing uncertainty around the French tax environment and economy, but has the potential to strengthen significantly should this change,’ the report explains.

Swiss buyers have become more common in the French Alpine market over the last five years, taking advantage of the strong Swiss franc and weak euro, while UK buyer numbers have declined.

‘Taken as a whole, the outlook for the Alpine property market looks positive with increased buyer interest and transactions in recent times,’ the report concludes.

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Article source - Propertywire

The world is about to be reminded of the thrill of skiing, as well as simply spending time in a mountain resort, when the Winter Olympics kicks off in Russia this week, an event that will reinforce why investment in ski property has never gone out of favour.

Richard Way, Editor at The Overseas Guides Company said:

“While the large majority of France’s property market remains flat, a leading property consultancy reported price increases of eight per cent in two key resorts in the Alps in 2013, thanks to growing demand from overseas buyers and infrastructure upgrades.

“Things are set to improve further this year, as one of the leading developers in the Savoie and Haute Savoie regions reported a huge hike interest in January compared with January last year.

“Conditions are favourable for purchasing in the French Alps too – with mortgage rates in France still at historic lows and the euro showing no signs of strengthening, it makes financial sense for some UK and other foreign currency buyers to purchase with a French euro-mortgage.”

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Source: EconomicVoice.com

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With the Winter Olympics almost underway, the four yearly event is expected to lead to an increase in interest in ski property with the market in the French Alps expecting a busy start to 2014.

But other factors are also contributing to a busy market in the Alps. Some wealthy French owners are offloading properties as they leave the country in order to escape President Francois Hollande’s tax regime and a further incentive to sell a second home in France sooner rather than later is the government’s reduction on its rate of capital gains tax (CGT), applicable only between September 2013 and September 2014.
 
The cheapness of French euro mortgages which are close to historic lows is attracting a lot of foreign buyers.

The Winter Olympics never fails to inspire people to hit the slopes. Having the event in Sochi is especially exciting for Russians, the host nation, as the wealthier ones already having an affinity to Alpine resorts, such as Courchevel.

Overall, foreign buyers, including Middle Easterners, are realising that France’s taxation of its rich residents won’t affect them as non-resident owners of ski homes, so they are taking advantage of the opportunities to purchase a euro asset that comes with strong lifestyle appeal and long term investment security.

Wealthy buyers are also attracted to Courcheval because of its airport which can take private jets. There have been an increasing number of high end restaurants opening in the resort which is famous for its three kilometre Combe de La Saulire red run.

Athyna Partners has seen an increase in sales in the French Alps with sales of French ski chalets above €1 million up 32% on last year’s figures. ‘There has been an unusually high amount of single dwelling development in the Alps over the last year. At least three times the number of chalets have been built compared with recent years. This is largely due to the pent up demand as a result of a large volume of buyers sitting on the fence for so long and now jumping off. This rush to the market has created a lot of demand for a limited supply,’ said Nicholas Leach, partner at Athyna.

‘The big popular resorts have seen most development. For example in Val d’Isere normally just two or three properties are built each season, yet last year eight were built in one project alone and we’ve sold all but one of these already,’ he added.

And buyers are demanding more with hot tubs, après ski bars and wellness and fitness facilities now regarded as must haves, followed by exterior under floor heating, alternative sports facilities and behavioural lighting.

‘It’s not all simply about personal enjoyment and satisfaction, top end buyers understand that a more luxurious property will command a higher rental for bookings. The chalet rental market is extremely demanding and only a few properties in each resort can compete at this level,’ explained Leach.

He also pointed out that while big resorts like Megève and Val d’Isere still retain their appeal, neighbouring resorts which were previously less desirable are now becoming popular. For example Combloux in the Evasion Mont Blanc domain is at least 50% cheaper than Megève, yet it is only four kilometers away and has direct access to the same ski domain.
 
So called super chalets are also becoming popular. An example is Chalet Husky in Val d’Isere which has seven bedrooms, a 32 square meter swimming pool, an array of wellness facilities, a bar, a gym, an archery and pistol range, an indoor climbing wall and a two storey indoor atrium garden.

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Source: Propertywire

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The process of buying property in Austria and Switzerland varies considerably to buying property in the UK, it is therefore advisable to familiarise yourself with the general rules and regulations of each country.

For example, the Swiss government restricts the sale of second homes to foreigners and have an annual quota of just 1,500 permits, however in Austria if you are an EU citizen you have the same rights and responsibilities as Austrian citizens regarding the purchase of homes in Austria.

Our buying guides are split between Austria and Switzerland, read below for our guide on buying property in each of these countries, including information on the buying procedure, purchase costs and buying offers.

Buying a Property in Switzerland

Buying property in Switzerland is relatively straight forward, but buyers need to be aware of several laws that are unique to the Swiss property market. Each canton has an annual quota of properties that they are allowed to sell to non-Swiss residents.
Purchase Procedure

Once the client has chosen a chalet or apartment, the procedure is as follows: Complete a civil status questionnaire; Complete a declaration of honour; Complete a Power of Attorney which states the following: Name and address of the purchaser Location and name of the property Number of the parking space (if applicable) Detailed selling price Schedule of payments, as a percentage of the total sale price; Produce a copy of his/her passport, signed.

The signature on the Power of Attorney and on the copy of the passports must be legalized. (i.e. witnessed by a notary) The above documents are normally completed with our help and then forwarded to the official Swiss notary who begins the purchase procedure. Once the notary has received all the completed and signed documents, plus the deposit, he will then sign the deed of sale and apply for the authorization of the sale. This can often take 2-3 months depending on the property.

Once the authorization has been received, the notary will duly record the deed of sale in the Land Register

The following legal restrictions are in place:

It is now possible to resell an apartment after its acquisition to another non-resident, subject to the restrictions under the Lex Friedrich. All applications must be made through a notary’s office, once a buyer is found.

Under Swiss Law, an owner or his family may occupy their apartment for up to six months per year (Maximum stay is three months per visit).

The accommodation cannot be rented on an annual basis (maximum 11 months and 1 week).

No authorization is required for the purchase of a principal residence if the buyer has a residence permit B (i.e. work permit for non nationals), except if the land exceeds 2,000 square meters.

EU citizens with a residence permit B and all foreigners with a residence permit C (i.e. residence permit for a non-Swiss national) can buy as many properties as they want. They are considered as Swiss citizens

Buying a Property in Austria

As a member of the EU buying property in Austria is highly regulated and very straight forward – although rules vary slightly from province to province.

Property in the province around Salzburg (Salzburgerland) tends to be the most interesting for foreign buyers – containing many large, well known ski resorts as well as having an established 2nd home market. Popular ski resorts in Salzburgerland include Zell am See, Bad Gastein, Obertauern, Saalbach, Maria Alm and many others.

Many new build developments in these ski resorts are now designated as ‘tourism residences’ meaning that you have an obligation to rent out your property when you are not there to ensure that resorts do not suffer from ‘cold’ beds. As an incentive, the VAT is often waived on property purchases in these residences – giving an approximate 10% discount in most cases. Exact rules do vary from project to project however, so please do discuss in detail with one of our team when you are considering purchasing.

Purchase costs

Purchase costs in Austria are between 6 and 9% of the purchase price. Consequently, property tends to be held for a long period of time. This has helped maintain a stable property market and deter speculative investors that have caused so many problems elsewhere in the EU. As an added incentive for long term investment, capital gains tax is waived on all properties held for at least ten years.

Typical total purchase costs are broken down as follows:

Notary Fees — 2.5%
Stamp Duty — 3%
Land Registry — 1%
Agency Fees — 3% (waived in some projects)

Buying Offers / Kaufanbot

Once you have found a property you wish to buy you make a formal offer to the seller by signing a Kaufanbot agreement. This is a formal offer and, if counter signed by the seller, is legally binding on both sides. The price and completion date is fixed and both parties are now obliged to complete the transaction. It can be ‘subject to finance’ in some instances. In many off-plan developments the developer will need to pre-sell a certain percentage of the development before counter signing the Kaufanbot.

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Source: Mark Warner

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Ski properties are increasingly in demand amongst wealthy investors around the world who are competing for an asset which is in relatively limited supply, according to new research.

They not only have lifestyle advantages but also the potential for long term capital growth as the average price of ski homes around the world increased by 4.6% in the 12 months to the end of June 2013, according to the latest index from Knight Frank.

This means that ski properties outperformed luxury homes in many cities and popular second home locations around the world such as the French Riviera, according to the Prime Ski Property Index (PSPI) which tracks the price performance of luxury homes located across 18 ski resorts worldwide.

Ski homes in South Lake Tahoe in the United States and Queenstown in New Zealand recorded the strongest price growth over the period, rising on average by 20.9% and 18.6% respectively.

In Europe, the Swiss resorts of Zermatt and Davos recorded the strongest annual price growth, up by 14.1% and by 10% respectively. These locations were closely followed by properties in the resorts of Morzine and Chamonix which saw prices rise by 8.5% and 8% respectively.

Aspen in the United States and Whistler in Canada were the next best performing North American destinations having recorded growth of 7.4% and 6.3% over the 12 months to June 2013.

‘Ski homes are appealing to a growing pool of wealthy investors who are seeking a relatively finite asset, one with lifestyle advantages and the potential for long term capital growth,’ said Kate Everett-Allen, of the international residential research team at Knight Frank.

In previous years the PSPI results were relatively clear cut with Swiss resorts at the top of the rankings for price growth, the French Alps mid table and the North American and Russian resorts towards the bottom.

In 2013 however, the resorts and their respective world regions are interspersed throughout the rankings. Despite record snowfalls in the Alps during the 2012/2013 season, the volume of property sales in the Les Trois Vallées has been limited, partly due to tight supply.

‘The ski property market does not function along the normal laws of supply and demand. Ski property owners are usually discretionary sellers with no pressing need to sell unless the right price is achieved,’ explained Everett-Allen.

The index shows that a consistent performer in relation to price growth has been has been the Swiss resort of Verbier recording annual price growth of 6.2% and 8.2% over the last two years. However, even here the volume of prime properties sold declined significantly in 2012.

‘We expect sales activity to improve during the 2013/2014 season as interest in ski homes spreads beyond Europe and North America to emerging centres of wealth,’ added Everett-Allen.

Indeed, a Knight Frank survey of HNWI advisors recently showed that their Latin American clients were the largest owners of ski homes and there was significant appetite for a ski property amongst their wealthy Middle Eastern clients.

The venue for the 2014 Winter Olympics, the Black Sea resort of Sochi in Russia, has seen a small rise in prices, up 1.3% in the 12 months to June. The decision to host the games in Sochi was announced in 2007 and the following two years saw residential prices rise by 40% to 50%.

‘However, the global financial crisis has weakened demand and prices are expected to remain relatively static in the run up to the Winter Games in February 2014,’ added Everett-Allen.

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New legislation around second homes in Switzerland can only increase demand

Buying property in Switzerland the land of picture-postcard villages, clean mountain air and a rock-solid economy-has always been restricted. Across the whole country, only 1,500 foreign-ownership permits are issued each year for properties of less than 250sq m (2,690sq ft), and some towns, such as Zermatt and Saas Fee, are virtually closed to non-Swiss buyers. But since March this year, the process has become even tougher, after the Swiss accepted an initiative put forward by environmentalist Franz Weber to limit the number of second homes in any given commune to just 20%.

Second homes currently account for some 12% of the overall housing stock in Switzerland, but the Alpine cantons of Valais and Grisons register well over the 20% quota. Ski resorts top the second-home list, with Laax at 80.9% and Silvaplana at 77.4%. ‘The problem is that it's a fluid situation, which keeps changing,' says local property expert Paul Hayes. ‘Recently, we've gone from a two-tier market with property being sold from the Swiss to the Swiss, and the Swiss to the non-Swiss, to three-tier-with even fewer second homes being made available for the non-Swiss.'

In September, the Swiss government decided the Weber Initiative would only apply to new-build properties, clarifying the situation for pre-existing property. As a result, no new construction permits will be issued after January 1, 2013 in places where the 20% quota has already been reached. In practice, this means that in a ski resort such as Verbier, which has traditionally been a favourite with second-home buyers, new residential building work will slowly dry up. In light of this, specialists believe that now is the time for the UK buyer to make their move: ‘There will still be new property coming onto the market next winter, but after that, it will get a lot harder.'

‘Typically, clients want to buy a chalet or apartment off-plan and finish it to their specifications, but that option will go in the future. The irony is that Swiss second-home owners are far less likely to rent out their second homes than foreign owners, such as the British.'

But the legislation affects Swiss buyers as much as those from the UK, and in areas that rely heavily on tourism, such as ski resorts, many are worried the new rules will lead to considerable unemployment. The strength of the Swiss Franc has already caused a decline in British tourists-the country's tourist board has revealed that the number of overnight stays by British visitors has dropped by 30% since the 2008-9 season.

‘Hotels, primary residences and commercial property will be the only permitted new building projects from the end of next year,' comments entrepreneur and property developer Marcus Bratter, owner of the newly constructed hotel La Cordée des Alpes and a Verbier resident. ‘But the government has clarified that there is scope to renovate existing buildings for second homes in specific cases.'

Legal challenges are, however, mounting over the validity of implementing the legislation, hurriedly issued in September by the Swiss government. Sandrine Giroud, a lawyer with Lalive in Geneva, explains: ‘Under federal-constitutional rules, the implementing legislation [the law or statute enacting the Weber Initiative] should be adopted by the Swiss parliament and enacted within two years from the acceptance of the Weber Initiative-that is, before March 11, 2014.'

With so many pending questions, the situation is far from resolved-the usage rate required for a residence to be considered ‘primary' has yet to be defined, and it's unclear whether property that has received planning permission between the adoption of the Weber Initiative and January 1, 2013 can be built.

But despite all the uncertainty, Mr Rollason reports no let-up in demand. ‘Switzerland retains its status, not only for lifestyle but also because it offers long-term stability,' he says. ‘People want to be exposed to the Swiss Franc because of its strength, and the housing market is far less volatile than most others. The barriers are restrictive, but only time will tell whether the legis lation will be watered down or reversed in some way.'

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