The Alps are the world’s largest ski market, and attract second-home buyers from across the globe. The Swiss Alpine resorts of Gstaad, St Moritz, Zermatt and Verbier are among the world’s most exclusive, and expensive, with ultra-prime prices ranging from €20,000 to €30,000 per sqm ($1,650 to $2,500 per sqft).
These resorts have diversified beyond skiing to cater to many of the other demands of the super-rich. Designer shopping, Michelin starred restaurants and polo are all part of the offer.
These ultra-prime resorts proved relatively resilient during the global economic crisis. Transaction levels slowed, but values were supported by restricted supply and the absence of forced sales.
In the prime markets, holiday home buying peaked in the 2007-08 season, and fell away significantly during the recessionary years. Discretionary second-home buyers, reliant on mortgage finance withdrew from the market after the credit crunch. Following a period of stabilisation, prices are now on the rise again although buyers continue to expect a discount, particularly for second hand properties.
Analysis of sales data suggests more sales are now taking place at lower price points. The resilience of the ultra-prime markets has started to ripple down the market ladder. The average purchase price of prime property transacted across core Alpine resorts was €1.5m in 2011, when only the very best properties were transacting. By 2014, this had fallen to just under €1m, with British buyers, in particular, purchasing again at lower levels.
The markets are also seeing an expansion in the breadth of buyers they attract. Prior to the global recession, British buyers dominated the market, accounting for the vast majority of foreign buyers in many Swiss resorts. Today, a much wider variety of buyers are present. These include a wide range of European buyers, particularly those from northern Europe and the Nordics, as well as those from further afield.
The premier Swiss ski resorts have been among the first to attract Chinese skiers outside of their homeland. Chinese skiers numbered just 10,000 in 1996, and now exceed five million. Switzerland is now second only to Japan as a recipient of these high-spending ski tourists. The Chinese have yet to make Alpine home purchases in any volume, but other Asian buyers are increasingly active in Switzerland, notably those from Malaysia, Singapore and Hong Kong.