Boom in UK overseas property purchases in French ski and mountain resorts
French Ski Resort Property Purchase Boom
Demand has always been high when it comes to properties within French ski resorts. Whilst COVID-19 has undoubtedly affected property markets, interest within French ski resort holiday homes is still on the rise, particularly amongst overseas buyers.
Investment and demand climbing in the French Alps
Though 2020 French property sales may not be as strong as 2019 due to the pandemic, data indicates that French ski resort properties, particularly within the French Alps, are still garnering interest. Recovery within the French property market picked up in May, with demand increasing during the summer months. According to agents, Chamonix and Tignes continue to remain popular locations.
More often than not, property purchases within French ski resorts are for second-holiday homes and buyers are willing to pay a premium to live amongst France’s natural beauty. MGM stated that on average a two-bedroom property within a French ski resort goes for between €320,000 and €350,000, while for a 3-bedroom it’s €450,000 and upwards.
Hallez confirmed that around 50-60% of property sales within French ski resorts are from French natives, however, the UK makes up 20% with the remaining buyers coming from Denmark, Belgium, Switzerland and Germany.
Race to the top
Luxury French ski resorts are involved in a “race to the top” to become global brands and are investing staggering amounts of money in redevelopment and infrastructure, says leading ski real estate specialist, Erna Low Property.
“In part, this wave of investment is being driven by a race to the top. These days, resorts are competing for A-list status with fast lifts, eye-catching accommodation, and state-of-the-art swimming pools. But it’s also an acknowledgement that changing tastes – and a changing climate – are reshaping what it means to be a mountain resort.”
“Vaujany, connected to Alpe d’Huez, is a great example of this where Erna Low Property currently has three developments in progress with sales being fuelled by the impending 2021 lift-link to the neighbouring ski resort Les Deux Alpes.”
French ski resort properties are investing heavily in redevelopment and infrastructure, Mr Marchand explains.
La Plagne announced €455 millions of new spending, with €12 million focused on new snowmaking systems. La Plagne is launching its first five-star apartment development, The White Pearl. Châtel continues to expand, with new developments taking advantage of its rising profile as a ski resort and a mountain-biking hub.
Erna Low Property has seen strong demand from French, British and international buyers, which is helping to drive a wave of new developments across the French Alps, he explains. Brexit seems to have had little impact, whilst COVID-19 seems to have stirred a desire amongst buyers to want to be in the mountains, away from it all.
“France is home to many of the world’s most famous mountain resorts and its largest and most exciting ski areas. With a long winter season lasting 22 weeks in some resorts and a buzzing summer scene in July and August, it offers investors significant rental returns – as well as the chance to lead a healthier, more active life. For many, the prospect of escaping into this beautiful and inspiring environment is just as important as opening up a new revenue stream.”
Cheap mortgages in France
COVID-19 does not appear to have affected banks lending, so many buyers have been able to get a French mortgage as normal. Ultra-low Euro mortgage rates mean the cost of borrowing is cheap. Repayments on a €240,000 fixed rate mortgage, for example, are considerably lower in 2020 than they were in 2011. For instance, monthly repayments on a 15-year €240,000 fixed rate mortgage in 2011 when rates were at 3.75% totalled €2,181, according to Erna Low figures. In 2014, with interest rates at 2.75%, payments fell almost €150 a month to €2,035 and in 2018 with 1.5% rates, borrowers saved another €173 with payments now at just €1,862 a month. In 2020, the repayments are just €1,490.
The age of rabbit hutch apartments has gone
French ski resort property buyers are looking for resorts with good summer and winter facilities, close to Geneva or other main airports.
New investment, ground-breaking technology, and changing tastes are re-energising the Alps. Along with the new resorts, the size, specification and standards of French ski resort properties are improving still further. Demand is growing for larger ski homes of 100-200 square metres.
“The age of the rabbit-hutch apartment is gone, and our partner developers, such as Nexalia and Terresens offer more spacious properties, with bigger windows, higher-quality finishes, and wood-burning stoves. Customised interiors (e.g. you can reduce the number of bedrooms if you want a bigger lounge), and more flexible rental schemes are all part of the scene now.”
Increasing budgets when buying a property in France
It’s no wonder that demand for a holiday home is on the rise. Erna Low Property, have seen plenty of interest from English-speaking buyers, with both enquiries and sales recovering during the middle of 2020.
With many buyers interested in purchasing a second home, most have money to play with and are willing to increase their budgets to secure a luxury alpine holiday home.
Buyers should be aware of a growing differentiation between lower and higher-altitude resorts. Up high, the focus is firmly on skiing. Lower down, summer is as important as winter. “But whichever style of resort they choose, they can be sure of one thing: if they love the mountains, few property investments could ever have such a richly-rewarding impact on their lives.”
Growing year-round attraction of mountain resorts
Meanwhile, new mountain bike parks, trail-running networks, yoga festivals and e-biking facilities are being enjoyed by a growing number of summer visitors in French ski resorts. “In fact, some resorts now see a brighter future as a summer destination than a winter one,” says Erna Low Properties.
The net effect has been to make the mountains more exciting than ever – year-round. “In winter, improving infrastructure is combining new equipment, and a new wave of wearable tech – such as the CARV digital ski instructor – to make us all better, happier skiers.
“At the same time, the idea of what a winter holiday can be is expanding. Music fans are being drawn into the mountains by a growing range of rock concerts (the latest is Chamonix’s April event, Musilac), whilst ski tourers are walking up the Alps, as well as skiing back down.”
French ski resort properties in the South of France
Erna Low Property has been selling holiday homes in the South of France for over 10 years. They specialise in the French Alps, Cote d’Azur and Provence. Many clients who are buying French ski resort properties, also want to invest in property in the south of France, close to Cannes and St Tropez. Among new developments is Villa Alice, close to Cannes, which offers apartments from just €150,000.
You would usually expect French ski resorts to focus on the winter ski season, but an increasing number are developing summer facilities, so they can become all-season resorts and draw in visitors year-round.
“In summer, the mushrooming growth of sports such as mountain biking has been accompanied by interest in the Alps as a family destination – a place where children can grow and prosper, away from social media and video gaming. As a result, the most progressive resorts are now almost as busy in July and August as they are during the ski season,” continues Mr. Marchand.
It’s no wonder that demand for a holiday home is on the rise, particularly for families with children. And, the new summer attractions make it easier to rent out an apartment or chalet in July and August.
“The French Alps are a big, beautiful and energetic environment, tailor-made for adventures – and parents see it as the perfect antidote to the obsessive, indoor world of video games and social media. So, an important part of their motivation is investing in the future of their kids as well-rounded, physically active people. They plan to spend as much time in their new homes in July and August as they do in winter.”
In the last five years, there has been a wave of state-of-the-art swimming pools and leisure centres across the region. These include the €16million Le Signal at Les Saisies, the €13million Forme d’O in Châtel, La Piscine in Les Arcs – part of the €36million Mille8 project – and the €63million Aquamotion in Courchevel.
As well as the Forme d’O swimming pool, Châtel is home to one of the best mountain bike parks in the French Alps and has recently launched a new network of trail-running routes in partnership with its sister resorts in the Portes du Soleil. Meanwhile, families can experience the thrills of the high-rope obstacle course at the recently-opened Châtel Adventures amusement center, along with a bob-luge track and mini-golf.
It’s a similar story in Les Saisies, part of the Espace Diamant ski area. Its forests and meadows are perfect for biking, trail running and hiking, but the resort also offers horse-riding, trampolining, archery, tennis and badminton. In addition, the Escaladventure park combines rock and tree climbing with rope bridges and zip wires.
Even rugged Chamonix is broadening its appeal. In fact, its busiest week is in the height of summer in August, during the Ultra Trail du Mont Blanc mountain marathon. Younger visitors flock to the outdoor leisure park, complete with Alpine coaster, as well as wildlife sanctuaries, paintballing, a new via ferrata protected climbing route, and both indoor and outdoor pools.
Want to get more French ski resort property for your money?
Working with an experienced currency specialist can save you thousands of pounds when buying your ideal mountain property, says David Johnson, founding director of Halo Financial.
“There’s a lot to think about when you buy a mountain home. Chalet or apartment? High altitude and snow, or low-altitude and cute Leaseback or classic freehold? There may also be mortgage brokers to contact, tax advisers to consult, and a notary to commission.
“So, it’s no wonder that picking the right moment to buy your Euros often slips down the list of priorities. But it shouldn’t: because using the right methods to exchange currency can bring big savings during the purchasing process.”
Exchange rates fluctuate constantly
Exchange rates fluctuate constantly and in the current political climate, these currency movements can be considerable, Mr Johnson says. “When it comes to buying property, the difference they make to the final cost is measured not in hundreds, but thousands of Pounds.”
At every stage of the buying process, there are ways you can save on the payments for your French ski resort property – whether it’s for the deposit, the final payment in Euros, or the ongoing mortgage or property maintenance costs.
Save time and money
“By enlisting the help of a currency specialist, such as Erna Low’s recommended firm, Halo Financial, you’ll bring a wealth of knowledge and experience to the task and save yourself both time and money.
“For example, Halo Financial currency consultants can monitor the currency markets and let you know how they are moving, as well as alerting you to upcoming political and economic news that will affect future exchange rates. When it comes to buying Euros, we can also offer rates that are usually closer to the Interbank rate – the rate banks use to exchange currency with each other – than your local bank.
“This means that the rate you can receive from a currency specialist can be up to four per cent better than the standard high street or retail exchange rate. That’s a difference of €20,000 on a €500,000 property!”
Download the full ski resort property report on the Erna Low website.
Find out more about buying property in France