Property sales boom in the Alps

18th June 2016, by Dave Watts

Erna Low Property have apartments in Combloux (linked to the Megève ski area) from 142,000 euros

Erna Low Property have apartments in Combloux (linked to the Megève ski area) from 142,000 euros

According to leading alpine property experts sales have been booming despite the uncertainty caused by a potential Brexit.

Erna Low Property published its ‘French Alps Property Report’ earlier this month.  Francois Marchand, Erna Low Property Director comments, “We’ve had a couple of great years at Erna Low Property. Sales volumes are up, revenues are up, and so too is the average price of each property sold.”

New-build apartments, rather than chalets, are leading the revival, says Marchand.

Rock-bottom Euro mortgage rates are one of the key factors behind the recovery. It’s now possible to get a 15-year fixed rate repayment mortgage with the interest set at just 1.40%. However, it’s easier to get a small mortgage than a large one at the moment. “Banks would rather approve ten €100,000 mortgages than a single €1 million one,” says Stéphane Brière of French mortgage brokers CAFPI International.

Leaseback schemes on French new-build apartments allow buyers to reclaim the VAT on their property purchase provided they put their apartment into a rental pool. In the past, most leasebacks gave owners just three or four weeks’ annual use of their property. But now, some schemes allow owners 26 weeks of use, alongside the full 20% VAT refund.

Erna Low Property suggests buying in ‘back-door’ resorts where prices are cheaper than in their fashionable neighbours – eg Les Menuires for the 3 Valleys, Tignes-les-Brevières for Val d’Isère-Tignes and Combloux for Megève.

Simon Malster, managing director of Investors in Property, has been selling property in the Alps for over 25 years. He says that ‘while British buyers have been holding off buying in France until the result of the referendum is known, there is still strong demand from clients living in the Scandinavian and Benelux countries. The Portes du Soleil region is booming and we have 2-bedroom apartments in Châtel from 375,000 euros.’

Malster is also selling properties in Switzerland, which has tight regulation of building in ski resorts and on ownership by foreigners. He says that in some ways ‘buying in Les Collons, linked to Verbier’s ski area, is better value than in most equivalent French resorts.’

The pound has fallen significantly against both the euro and the Swiss franc in the last few weeks because of Brexit uncertainty. This has pushed up property prices in terms of pounds – bad for British buyers but good for those who already own in the Alps. If we vote for Brexit, most experts expect further falls in the pound; but if we vote Remain the pound is expected to recover sharply.

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