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French Alps ski property market reviving thanks to low mortgages and new infrastructure
The French ski property market is recovering with new build apartments, rather than chalets, are leading the way and interest boosted by new infrastructure projects, new research shows. Those choosing to buy in key Alpine resorts will also find far more facilities available such as the €36 million mini-resort Mille8 in Les Arcs, a family friendly resort within a resort with new nursery slopes, tobogganing runs, a swimming pool, spa, gym and Courchevel's €63 million waterpark and spa Aquamotion. La Compagnie du Mont Blanc announced recently that it would spend €477 million over 40 years on new lifts and pistes in Chamonix while Val d’Isère has just spent €16 million renewing lifts, pistes and restaurants on La Tête de Solaise, immediately above the town. Rock bottom Euro mortgage rates are another key factors behind the recovery, according to the French Alps Property Report from Erna Low Property. It points out that it is now possible to get a 15 year fixed rate repayment mortgage with the interest set at just 1.4%. However, it is easier to get a small mortgage than a large one at the moment. Indeed, according to Stephane Briere of French mortgage brokers CAFPI International banks would rather approve 10 €100,000 mortgages than a single €1 million one. The report suggests that activities and facilities in the summer are as important for buyers in the Alps as the winter sports. Road cycling, mountain biking and trail running have all made the summer fashionable again in the mountains, and buyers want to know what a mountain resort offers in July and August as well as winter. In part, that's because some are keen runners and cyclists themselves: but also because they're looking for better rental returns. Also leaseback schemes, which allow buyers to reclaim the VAT on their property purchase provided they put their apartment into a rental pool are becoming more flexible. In the past, most leasebacks gave owners just three or four weeks' annual use of their property. But now some allow owners 26 weeks of use along with the full 20% VAT refund. The report also says that a new wave of developments is giving buyers who are keen skiers the chance to buy back door entry to the world's most famous ski areas and make big savings in the process. Buying in Les Menuires, for example, will give the owner the whole of the Three Valleys. Meanwhile, an apartment in Tignes-les-Brevières gives access to the slopes of Val d'Isère. According to Francois Marchand, Erna Low property director, sales volumes are up, revenues are up, and so too is the average price of each property sold and British buyers are returning but they are more realistic about what buying a second home in the mountains means. ‘These days, our clients see their property purchase as bricks and mortar with benefits, a long term investment whose primary purpose is to improve their quality of life. We’re noticing more… Continue reading
UK house prices fall ahead of EU referendum, latest index shows
More evidence is emerging that the run up to the referendum on the UK’s future in the European Union is affecting residential property prices. Property values in England and Wales fell by 0.4% in May, the steepest fall since November 2011, according to the data from the lastest index from Your Move and Reeds Rains. This takes the average house price to %293,599 and year on year values are still up 6.8% but 5.4% if London and the South East are excluded from the calculation. However, London’s house prices fell by 0.3% or £1,769 month on month and it was the weakest May for home sales in five years, after stamp duty surcharge caused a rush of buy to let sales in March. But house prices in Slough defied the trend, jumping 23.3% year on year, with values lifted by Crossrail and new tech jobs, according to the index report. According to Adrian Gill, director of Your Move and Reeds Rains estate agents, May’s correction in property values also follows on from a surge in activity earlier in the year, when second home buyers and landlords brought forward their purchases to avoid the stamp duty surcharge. ‘That tax hike and the Government’s anti-landlord policies are weighing down the market, but the main factor is short term confidence ahead of the 23rd June referendum,’ he said. The year on year growth in house prices has also slowed, down to 6.8% in May, from 7.7% in April. ‘With the Chancellor predicting that a Brexit from the EU would reduce property values by at least 10%, many buyers are holding off until after the uncertainly surrounding the referendum has been resolved,’ Gill explained. The fall in prices in London has pushed average property values in the capital city back under the £600,000 mark, with the value of a typical home in the city falling to £598,421. However, this decline in property values has not spread across the entire capital. While house prices in the most expensive eleven boroughs have declined by an average of £4,000 or 0.5% from the previous month, values in the cheapest eleven boroughs continue to rise, jumping £3,000 or 0.8% month on month. But despite maintaining property values well above the rest of the UK, the demand for homes in London continues to grow. In the three months between February and April, sales of homes in London increased by 15%, compared to the same period last year. ‘The majority of this upswing in sales came from flats. As landlords often prefer to provide flats to rent, these properties were a popular choice before the stamp duty surcharge came into force in April,’ said Gill. He also pointed out that with so much uncertainty in the UK economy, home sales have been subdued. While the total number of property sales did increase from the previous month, this month has seen the fewest May property sales since 2011,… Continue reading
House prices and sales rising in New Zealand due to chronic lack of supply
A chronic lack of supply is fuelling a regional growth in house prices and sales volumes in New Zealand, according to the latest monthly index report. Sales volumes hit new levels and median house prices reached new record highs across more regions of New Zealand than ever before, according to the latest figures from the Real Estate Institution of New Zealand. Record median prices were reached in Waikato/Bay of Plenty, Taranaki, Canterbury/Westland and Otago. The report explains that this shows the growing halo effect of rising prices around New Zealand is strengthening in the regions where it is already present, and moving on to new regions, driven by a chronic lack of supply. On a seasonally adjusted basis the number of dwellings sold in April 2016 rose by 12.8% compared to March, indicating that the normally expected drop in sales between March and April was far smaller than usual. And compared to April 2015, all regions recorded increases in sales volume. At the same time, the availability of properties for sale has fallen by over one third over the past 12 months, with a number of regions seeing declines of more than half. Days to sell, another measure of demand has also fallen by more than 20% over the past 12 months in nine of the 12 regions. The national median price was $490,000 for April, an increase of $35,000 or 7.7% on April 2015, and down 1% compared to March. Excluding the impact of the Auckland region, the national median price rose $29,000 to $382,000 compared to April 2015. REINZ chief executive Colleen Milne said that the April data confirms the continued strength of the real estate market right across New Zealand, driven by a chronic lack of supply. ‘Anecdotal evidence suggests that investors outside of Auckland are increasingly looking to real estate investments to improve their yields compared to bank deposits. First home buyers are also taking advantage of low mortgage rates, putting pressure on the number of properties available for sale,’ she pointed out. ‘The strength of the seasonally adjusted level of sales demonstrates that the year on year median house price rises, excluding Auckland, underlying demand for real estate across New Zealand remains strong, with every region recording an increase on a seasonally adjusted basis,’ she explained. There were 8,568 unconditional residential sales in April, an 18.4% increase on April 2015 and a 10.1% decline on March. On a seasonally adjusted basis, the number of sales rose 12.8% from March to April. The strong increase in seasonally adjusted sales reflects a smaller decline in sales between March and April than is normally the case. Over the past 10 years the average decline between March and April has been 16.6%. Sales volumes excluding Auckland, were up 28.8% on April 2015 and up 29.4% on a seasonally adjusted basis. All regions, apart from Northland, Auckland and Taranaki are showing in excess of 20% annual sales growth. Indeed, Auckland saw the number… Continue reading
