Alpine Ski Stations Continue to Outstrip French Property Market

The price of Alpine ski resort properties continues to outstrip the main French property market, according to a new market report. The Chambre des Notaires from Savoie and Haute Savoie reported last month that prices in many ski stations continue to rise at a rate in excess of 10% a year. On average, in 2007 an apartment changed hands at €4446/m² in the two departments, an increase of 11% over 2006.

Price rises in the Haute Savoie outstripped those of its traditionally more popular and expensive neighbour, the Savoie.

Table: Alpine Property Market 2007

Department	Haut Savoie		Savoie
	Older	Newer	Older	Newer
% Increase	13.2%	16.4%	9.2%	4.7%
Average Price	€4373/m²	€5155/m²	€4515/m²	€5544/m²

Highest prices for older apartments were in Courchevel 1850 (Savioe) where the prices averaged nearly €15,000/m². Val d’Isère (Savoie) and Megève (Haute Savoie) occupied respectively second and third place on the podium with prices of €7683/m² and €7206/m². Amongst new apartments highest average prices were to be found in Les Arcs (€10,561/m²) and La Plagne (€9770/m²) both in the Savoie, followed by Flaine (€7807/m²) in the Haut Savoie. If you are prepared to invest in the valleys rather than in the popular resort stations, then the prices drop dramatically. Older apartments in the Savoie change hands for around €2800/m², whilst those in Haute Savoie for around €2200/m². You should expect to pay 25%+ for a newer apartment. If you are looking to buy a chalet, then prices vary enormously, with larger chalets attracting the greater price per m². There is a particular shortage of larger properties, and suitable sites for new developments, designed to meet modern requirements, are becoming increasingly difficult to find. The notaires consider that one of the reasons for the increasing popularity of the Haute Savoie has been a greater level of investment in some of the stations, now more suited to the demands of the current market.

Whilst many of the stations in the Savoie have smaller properties close to the slopes, the Haute Savoie is able to offer a greater number of larger properties, in locations offering a wider choice of winter and all year round activities. Indeed, the demand for larger apartments and chalets seems to be outstripping supply everywhere, and the bigger the property, the more expensive per metre square it is likely to be. Whereas in the 70s an apartment of 20m² to 30m² was the norm, the requirement now is for accommodation from 40m² upwards. Most of the demand is coming from abroad, with the Russians in particular foremost amongst the newest entrants into the market, alongside long-standing British investors. On average, British buyers accounted for around 15% of all sales of older apartments, and 25% of new apartments, with the Haute Savoie their preferred area of choice.

The problem for the ski stations, is that around 30% of all of those who take a holiday in a ski station do not actually go on the slopes, for the mountains have become an increasingly popular location to participate in a broader range of leisure and health based activities.

In response, many of the stations have had to invest substantially in new resort facilities and infrastructure, including a substantial retailing offer in the larger stations. As a result, since the Millennium skiing in France has enjoyed some its best years in decades, after the doldrums of the 1990s, when skiers deserted outdated French resorts in droves. This year has been no exception, with excellent snow cover throughout the Alps, accompanied by generous sunny weather. Given the exceptional conditions, most stations are reporting an 80% to 100% rate of reservation. However, with climate change now making the presence of snow in some resorts a gamble, it now pays to consider carefully where to invest. Recently, one low level Alpine French ski resort (Abondance) shut up shop for good, simply because it was not able to keep the slopes open long enough during the year to make it viable. As a result, the livelihood of the whole village is now threatened. Opinion is divided on where the market will go. Whilst there is understandably a fear that climate change will bring about a downward pressure on prices, many commentators are forecasting that, as the number of suitable skiing resorts reduces, prices in those that are left are going to increase.

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