Swiss ski properties: Soaring prices defy the pandemic

31 January 2022

7 minute read

Swiss ski resorts are known the world over for their elegance and exclusivity. From the enchanting Alpine village of Zermatt sitting at the foot of the imposing Matterhorn, to the high-octane and high-end resort of Verbier, right through to the winter wonderlands of both St Moritz and Gstaad, they’re the ultimate ski getaways for celebrities, billionaires and royalty alike.

But they are also some of the most welcoming. After the near write-off of the 2020/21 ski season in Europe, Switzerland was one of the few Alpine countries to remain open to skiers. Despite the Omicron wave sweeping over Europe, it’s a similar story this winter, with Swiss ski lifts operating for foreign visitors once again. And it’s one of the many reasons why these high-altitude meccas continue to be perennial favourites for international property buyers.

“This notion of Swiss independence, that they’re able to keep the slopes open while others haven’t, has really laid bare to the international community that Switzerland remains a safe bet and key draw for property buyers,” says Alex Koch de Gooreynd, Swiss Property Partner for Knight Frank.

“Whether it’s a ski chalet or an apartment overlooking Lake Geneva, those sort of holiday apartments can still generate an income – even during a pandemic – and they are still very much of interest.”

Double-digit price growth at Swiss ski resorts

So much so, Swiss resorts now sit proudly atop Knight Frank’s Ski Property Index for the first time in three years1. The yearly report, which tracks the world’s top ski destinations, saw the resorts of St Moritz (16.5%), Klosters (14.4%), Davos (13.4%) and Verbier (10.2%) all record double-digit property price growth in 2021, the highest performing of all Alpine areas. French resorts, by comparison, saw much smaller price growth.

Stock shortages and strong demand have caused this spike in prices across many Swiss resorts, although the Knight Frank report suggests 2021 may yet prove something of an “anomaly” with prices expected to normalise once the COVID-19 crisis eases.  

Similarly, Savills’ Winter 2021/22 Ski Report – which reported a 5.1% rise in asking prices at ski resorts globally last year – found that Switzerland had performed better than most and was now the favoured European destination for ski property buyers2.

“Switzerland has always ranked among the best places to live in the world with its stable economy, reliable politics, relatively low taxes, good infrastructure and easy access to the great outdoors,” says Jeremy Rollason, Head of Savills Ski.

“That’s why its ski chalets are often seen as property gold. The value of these properties usually reflects GDP in most normal economic cycles; they’re solid assets that rarely depreciate and also give you exposure to a non-euro denominated currency.

“But 2021 was certainly an interesting year. We were initially quite reserved for the Swiss ski property market due to COVID and the state of the economy. But what we’ve seen is exponential price growth.”

Local buyers push up ski chalet prices

Much like the rest of the world after the pandemic exposed shortcomings with people’s living arrangements, the idea of leaving cooped-up urban areas for a new life in the country appealed to many.

“Across the globe, prime and super-prime markets are continuing the trend of 2021 with strong domestic demand complemented with emerging international buyers,” says Stephen Moroukian, Product and Proposition Director at Barclays Private Bank.

“The Swiss Alps is no different, with supply under pressure from those seeking retreat from city centre life to international second homes capable of sustaining family and work over a longer time window.”

For Switzerland, a landlocked nation with two-thirds of its surface area covered in mountains, Swiss-style rural living typically means moving to one of its idyllic lakeside villages on the Central Plateau or opting for a chalet at one of its 348 ski resorts, next to some of the tallest peaks in the Alps3.

“We’ve seen a lot of domestic buyers replace their principal residences in Geneva and Zurich and shift to the ski resorts,” says Rollason. “Instead of five days in the city and two on the slopes at the weekend, we’re seeing a reversal of that. And a lot of people are repurposing their properties so they can work remotely.”

Some of the bigger ski resorts, such as Verbier, Gstaad and St Moritz, are already fully geared up to year-round living – with schools and super-fast broadband now as much a part of the fabric as ski lifts and snowmobiles.

“The level of demand for Swiss property has never been stronger,” says Stuart Butler, Director of Credit Structuring for Barclays Switzerland.

“Both existing and prospective clients based in Switzerland, the UK and the Middle East are continuing to look for both chalets in the prime ski resort locations, in addition to family houses in Geneva and Zurich.”

Navigating the buying process in Switzerland

Restrictions are imposed on the properties you can buy in Switzerland if you’re not a Swiss citizen or permanent resident.

Foreigners can only buy in designated holiday zones away from the main cities, mainly the ski resorts as well as Montreux and Lake Lugano – for properties with a maximum living space of 200 square metres.

Despite the restrictions, there continues to be significant demand from non-residents – especially with buyers now heading back to Switzerland as COVID-19 restrictions ease.

Another rule that’s taking on more significance is the ‘Lex Weber’ law, enforced from 2016, which limits the number of holiday homes to one-fifth of an area’s total stock regardless of whether you’re a Swiss resident or foreign investor. It means new builds for second homes are now prohibited in most ski resorts – which are well above this 20% threshold – restricting buyers to the resale market.

Pre-Weber, developers in many ski resorts scrambled to get planning permission for their projects to avoid the rules, causing an initial oversupply of properties which saw prices stagnate. Only recently has this glut worked its way out of the market.

“The ski resorts are now very under-supplied,” says Rollason at Savills. “For the first time, we’re seeing the full effect of Lex Weber take hold. Allied to the pent-up demand from the pandemic, it’s creating the perfect storm.”

The only exception is Andermatt, the biggest ski development in the Alps, which has an exemption from Lex Weber until 2040 to encourage investment4. At more than 1,400 metres above sea level, the revamped Alpine resort in the Urseren Valley and within easy reach of Zurich and Milan is being transformed with new hotels, apartments, restaurants and luxury hotels.

The ‘race for space’ around Geneva

Elsewhere in Switzerland, as we highlighted in an earlier article on Swiss prime property, prices generally held up well last year – especially larger homes with outdoor space.

“Areas with close contact to the major cities, but with more space, performed well in 2021,” says Koch de Gooreynd at Knight Frank.

“Around Geneva, on the city’s Left Bank on the southern edge of the lake, the desirable suburbs of Cologny, Collonge-Bellerive and Anieres – with their exceptional lake and mountain views – have all seen huge interest.

“While on the other side of Lake Geneva, the lush countryside area of Terre-Sainte – from Genthod going up to as far as Nyon – is proving very popular and interesting with clients.”

With buyer demand strong across Switzerland and a shortage of properties coming to market, especially the ski resorts, prices are expected to remain strong as we head into 2022.

“The reasons people are interested in Switzerland have not gone away during the pandemic; if anything, people are becoming more drawn to it with their longing for the mountains, as well as a business culture that supports a healthy work-life balance,” adds Koch de Gooreynd.


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