Here’s how to dodge the pitfalls so your purchase isn’t an uphill climb. After a dispiritingly warm start to the year, the Alpine ski season is back on track with lifts rolling right across Europe.
Austria has long restricted its property market and, despite being a favourite market for British skiers, post-Brexit it is now firmly out of bounds.
“We still get at least one inquiry a day from British buyers for Austrian property but, bluntly, we tell them to go to France,” says Giles Gale of Alpine Property Finders. “Only EU passport holders can buy in Austria and there’s no getting around this for most resorts. Your only option is to buy jointly with an EU passport holder or to find so-called “zweitwohnsitz” [second home] properties. These are available to non-EU buyers but are few and far between and in high demand. I see two or three a year at most.”
Zweitwohnsitz properties were created in the 1970s to boost investment in quieter areas and are rarely close to ski lifts. If a non-EU passport holder can find one and agree a price, the owner must advertise that price for six months, allowing any EU citizen to match it.
“In 2015 60 per cent of our clients buying in Austria were British but now those numbers have collapsed,” Gale says. “Our last two British clients bought in December 2020 and have been readily replaced by other Europeans. For British buyers our message is don’t waste time looking for an elusive property. Head to France instead.
France is the number one Alpine country for British skiers and British passport holders face no official buying restrictions.
Under the French leaseback system, set up in 1986 for property given to a management company to handle rentals for a minimum period of nine years, buyers are entitled to a refund of the 20 per cent VAT paid on the purchase price. However, low yields have caused liquidity issues for some owners, Gale says. Instead, buyers should explore the ability to reclaim VAT on freehold new-build properties when operating short-term rentals. Properties must be rented fully furnished through a reputable management company and must offer at least three hotel-type services, for example, key holding, bed-changing or breakfast service.
“There’s no minimum number of weeks to rent in order to reclaim the VAT but you must demonstrate some income and be seen to run a commercial business,” Gale says.
“It’s a common myth that foreigners can’t buy in Switzerland,” says Jeremy Rollason, head of Savills Ski. “They can, but with restrictions. Rules are governed by the Lex Koller and the Lex Weber. Through the Lex Koller, non-Swiss buyers require a permit and numbers are limited to 1,500 a year with only certain “touristic cantons” where they can purchase. The Valais and the Vaud are most popular, while Zermatt is one resort completely closed to non-Swiss buyers. The Lex Weber, introduced in 2016, imposes a restriction on the construction of second homes where the percentage exceeds 20 per cent of total housing stock in a given commune. This automatically captures the vast majority of ski resorts.”
In general foreigners cannot buy homes over 200 sq m and must hold property for at least five years.
“Switzerland doesn’t have a flat-rate property tax as with France and the bank base rate is just 1 per cent, significantly below the European Central Bank,” Rollason says. “They like stability and this prevents people flipping properties. You can get special dispensation to sell earlier for ill health, divorce or financial hardship, for example, but you cannot make a profit.”
Buying costs differ between cantons, typically 3 per cent in the Valais and 4.5 per cent in Vaud but are all below the top level in France (7 per cent) and Italy (9 per cent).
Skiers who want to max out time on the slopes will always value living directly on the piste and proximity to the slopes is a priority for parents managing children and their cumbersome kit. Yet some buyers exchange that convenience for a property in the centre of a lively village.
Europe’s lack of snow at the start of the year put the focus back on altitude, but higher resorts often mean a resort with less of a year-round vibe (and therefore less potential rental) and also a longer transfer time from the airport, not good for quick weekend getaways. Snow-sure Val d’Isère, for example, is over three hours’ drive from Geneva, whereas Chamonix, Villars-sur-Ollon and the low-lying Morzine are all from about 80 minutes.
We bought in France...
Stephen and Rebecca from Winchester bought a two-bedroom property in Les Gets in 2015, ideal for frequent ski holidays. However, the arrival of their two children, now five and three, meant they visited less, selling it in 2021. They missed the mountains, though, and wanted their children to learn to ski, but renting a chalet in the school holidays was expensive. So they chose to invest in August, a co-ownership company, part-owning a chalet in Chamonix as well as four other properties in Europe.
“Convenience and location are the appeal,” says Stephen, 42. “We love to ski so proximity to the slopes and being close to the airport, one hour from Geneva, is key. Our new apartment has four bedrooms, so grandparents can come too, or we invite friends. When we arrived at our first apartment you were never sure what you were opening the door to and we had to deal with maintenance and cleaning, which eats into holiday time. There’s none of that with August.”
Repurposed from an article featured in The Sunday Times
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