Posted on 04 February 2012
Alpine ski property is currently one of the hottest buys in the world of overseas property, it seems that everyone wants a piece of the action. Savills, Knight Frank and all the big players have recently began taking an increased interest in the sector, many of them even launching new indices and research studies specifically about skiing property in the Alpine region.
There are a lot of reasons for this. We hear a lot about what is arguably the main reason; about how ski property is a safe haven. This is because ski property in the Alps is on the pricey side, so with its main buyers being wealthier this means that if they want to sell they can afford to hold out for the best price, rather than accept a lower price for a quick sale. As we know sale prices dictate asking prices and vice versa, so this is a cycle of holding prices in expensive locations like the alps.
A safe haven is highly sought after at the minute with inflation devaluing cash at an alarming rate in most countries, and currency conversion rates volatile to say the least, holding cash is far from safe. The stock markets aren’t much better either, as we all saw in the second stock market crash last year when America lost its Triple A rating. So wealthy individuals and investors are keen to put their funds into illiquid assets like property, and ski property is a safe bet.
At the same time we have increasing demand for self invested pension plans, like the UK SIPPs. This is another result of the stock market volatility. Pension funds are heavily invested in stocks and shares and have lost out as a result. Thus confidence in high street pensions is currently at an all time low. Ski property comes into it because French leasebacks are, by definition perfect for SIPPs because the property is leased back to a commercial entity.
And finally, completing the perfect storm is, a perfect snow storm. Right now the ski conditions in the Alps are better than they have been for years. A perfect storm making ski property the hottest buy in the world of overseas property, a perfect storm indeed.