Property prices in ski resorts are booming after several years in the doldrums following the global economic downturn, says a new report.
The Knight Frank Prime Ski Property Index shows that the average price around the world dropped 9.1% since hitting a peak in 2008.
But the average price climbed by 1.5% in the three months ending in June this year.
However, the increases are not across the board but are focussed on select resorts, mainly in Switzerland.
The property analysts say that prices will increase for many more ski resorts next year, after some Swiss locations saw prices rocket last year.
Swiss property tax change
The Swiss resort of Zermatt had the biggest property price rise, with 18%, followed by Gstaad with 13.2%, Verbier up 8.8% and Davos rising 5.6%.
Knight Frank says wealthy buyers are leading the recovery, though many potential buyers are waiting to see what the Swiss property tax changes will bring next January.
That’s when a nationwide ban on second homes could be imposed on areas where second homes make up more than 20% of the total homes may take effect.
With the number of high net worth individuals in Switzerland set to increase from 63,000 to 86,000 people by 2016, prices should rise further with many of these people saying investing in quality property is high on their list for investment classes.
The result will see demand for the world’s best ski homes strengthen, especially since a recent survey by Knight Frank in the US and Canada found that 38% of ultra high net worth individuals expressed an interest in owning a ski property.
Winter sports lifestyle
The international demand also means that exchange rates can prove to be a vital factor.
The report points to the strong Canadian dollar as beneficial to US-based buyers.
A US resident who bought a ski property in Canada between 1999 and 2006 could see a profit of between 30% – 45% based on the exchange rate alone if they sold up.
Another important factor in the increasing popularity for a ski home is the trend for resorts to market as year-round destinations. Many have invested heavily in conference and summer sport facilities.
Knight Frank says investors are not buying in ski resorts just to make money but to also take part in the winter sports lifestyle.
Buyers are also grouping in different resorts – for example, the Chinese are investing in high numbers in Whistler, Canada, while the British and Australians are buying property in Aspen, USA.