If you are thinking of buying a bolthole on the side of a mountain somewhere, you should be aware that the winter sports business is changing fast. Around a quarter of visitors to Alpine ski resorts are now non-skiers, which means they are changing the services they offer to appeal to tourists throughout the year – with water parks, spas and mountain bike trails, says Knight Frank’s latest Ski Property Report.
The industry is also being affected by climate change, points out Savills in its 2018 Ski Report – changing weather conditions are making it increasingly hard to predict the best times to ski. “Add to that an ageing population in the major source of markets, and changes in the way leisure time is being spent, and the outlook for ski resorts is challenging”, says Savills. So if you’ve been thinking about buying a ski chalet for the odd weekend away, and you’d like to make money from it when you’re not there, you need to follow these trends.
In general, ski chalets tend not to be great investments. As Knight Frank pointed out last year, most ski homes only generate an annual 2-2.5% net return, and in the year to July 2017, ski home prices fell by 1.8%. Overall skier numbers peaked at 1.4 million visitors for the 2007/08 winter, and fell to 1.1 million for the 2010/11 and 2011/12 winters, according to the 2017 International Report on Snow and Mountain Tourism.
So you are unlikely to make much money from buying a chalet – indeed, you’ll be lucky if you manage to cover the costs of maintenance and personal expenses. However, if you still like the idea of a regular base from which to head off to the mountains, or maybe to the spa or mountain bike trails, make sure that you look to buy in a resort that is adapting to the trends in the ski market.
Indoor snow slopes, usually found in locations without any kind of natural skiing, are now being planned for some resorts, says Savills. Tignes, one of Europe’s highest resorts, has plans to invest €62m into a 400m-long indoor slope to enable skiing all year, while Austrian resorts alone have invested €1bn in snowmaking machines over the past decade. Resorts are also “doing their bit to reduce their carbon footprint”, with some “actively managing their energy usage [and] finding the most efficient ways to groom the slopes”, to ensure they remain viable ski destinations.
Savills’ “ski conditions resilience index” ranks resorts based on snowfall, snow reliability, season length, altitude and temperature. Swiss resort Zermatt, which is north-facing and at a high altitude, came out on top, with US resorts Vail and Aspen ranking second and fourth due to their high altitude and high levels of reliable snowfall.
However, the most reliable, high-altitude resorts are, by their nature, also often the hardest to reach, warns Savills. Make sure you factor in distance from airports and train stations when picking a resort, as this will affect the appeal of your chalet to visitors. Finally, read up on local laws and taxes – for example, Switzerland limits foreign ownership of commercial property (although the Andermatt resort has an exemption from this), while France’s wealth tax still applies to property assets.