Snow fell on most of France’s ski resorts and the ski areas are welcoming the French holiday makers. This gives us an opportunity to look at the real estate market of major resorts in Savoie and Haute Savoie. What are the real estate prices of the most popular resorts? Where should you invest? The answer is here!
A dynamic real estate market in Savoie & Haute Savoie
According to a recent study by FNAIM (the French real estate federation), real estate sales have increased by 9% in Savoie & Haute Savoie. At the end of July 2017, there were 30,924 preliminary sales agreements signed in one year. Just as in 2016, the market is very dynamic, stimulated by low interest rates. High-end real estate buyers have benefited from favourable exchange rates and been reassured about future tax measures implemented after the wait-and-see tactics associated with the presidential elections.
The proportion in these transactions representing small studio (18% of purchases over the first half of 2017) and single-room spaces has declined due to lifestyle changes among buyers. They want to be with family and friends more than before when owners of second homes spent their day on the slopes. Their living spaces must therefore be larger, which explains why they prefer one-bedroom (35%) and two-bedroom (32%) spaces instead.
Real estate prices per sq. m. can vary by double the price depending on the resort
Last year, according to Notaires de France, prices per sq. m. increased in half of the ski resorts of Les 3 Vallées. That was particularly the case with Courchevel, Méribel, and Les Menuires (average price in Les 3 Vallées: €4,680/sq. m.).
Depending on the property type, location, and resort reputation, real estate prices can sometimes reach peaks. In Courchevel, for example, a 242sq. m. apartment sold in April for 8.6 million euros, or 35,640 euros per sq. m. Real estate prices in Val Thorens, Savoie’s flagship resort, are also high, averaging €5,272/sq. m. for an apartment and €5,837/sq. m. for a house.
For the fourth consecutive year, it was just named the world’s best ski resort (and one of its hotels, Farenheit7, was named the world’s best hotel), enough to attract investors and families seeking a second home. Even though the resort’s prices are within the high range of real estate prices in Savoie, they are lower than in Val d’Isère (€9,084/sq. m.) and Courchevel (average of €7,900/sq. m. for an apartment).
Not all Savoie resorts are seeing increases in their prices per square metre. In fact, prices have fallen in about one third of the resorts, such as Morzine (-7%) and Grand Bornand (-0.6%).
Prices for existing properties by commune according to Notaires de France data in April 2017
These price differences can be explained in part by the location of the resorts. Due to the lack of snow in recent years, low-altitude resorts have been less popular than high-altitude resorts, with the exception of Megève, Chamonix, and La Clusaz, which are located at an altitude of around 1,000m, where average prices fluctuate between €6,000/sq. m. and €7,000/sq. m. For people seeking to invest in rental property, the very high occupancy rate in high-altitude resorts provides a good return on investment and assurance of a gain on resale.
The other factor that can justify these prices, which can vary up to twice as much, is the quality of the real estate stock. With the establishment of luxury hotels, real estate prices have necessarily increased in certain resorts, while conversely in resorts like La Plagne and Les Arcs in which the real estate stock dates back to the 1970s, the average price is lower.“Prices in Megève and Chamonix are equivalent to those in Paris, but after all, skiing on the Champs-Élysées is more complicated”, explained Jean-Jacques Botta, Chairman of FNAIM Savoie – Mont Blanc.
Significant presence of non-residents in the region’s real estate purchases
According to Notaires de France, one in five buyers in Savoie and Haute-Savoie is a non-resident. The English rank first and accounted for 45% of investors at the beginning of the year, followed by Belgians and Swiss. According to a local notary, in the Mont-Blanc Valley in particular, 27% of sales are made by non-resident clients.
Which resorts have good deals?
Less expensive real estate can be found away from the major resorts. Les Houches (€4,320/sq. m.), Les Contamines Montjoie (€3,110/sq. m.), and Saint Gervais les Baths (€3,070/sq. m.) are villages where real estate prices have fallen and property is still affordable.
Be aware that the time frame for selling is longer than average
According to FNAIM, sales take 5 months compared with 94 days (approximately 3 months) on average in France in 2017. This is a specific characteristic of the mountain real estate market, due to international competition. According to the Chairman of FNAIM, “Most sellers who don’t need to sell take their time”.
