The race is on for a place in the snow as the Swiss raise the drawbridge
Switzerland is turning away foreign buyers from some of its most popular resorts, says Nicola Venning. But there is still a way in Don’t knock the self-preservationist Swiss, says Emma Hartley. Britain would do well to follow suit and help curb house-pri
With Switzerland closing its doors to foreign buyers in Valais faster than an Olympic skier, many would-be purchasers are feeling left out in the cold. But just as there is more than one way to ski down a mountain, so there are alternative ways of still buying in this popular and risk-free country.
The Swiss moratorium on foreign nationals owning property came into force in January this year. It is in response to surging demand for snow-homes from foreign nationals who have been allowed to buy for the past six years. One of the most popular cantons – the Valais, home of Verbier and the Four Valleys – has seen capital appreciation of nearly 50 per cent more than the national average in the past four years and there are currently almost 1,000 outstanding applications from nonresidents aiming to buy here.
In response to this, a 12-month moratorium (until December) is in place on sales of second homes to nonnationals in seven Valais communes: Bagnes (Verbier), Grimentz, Heremence, Nendaz, Riddes, Val d’Illiez and Veysonnaz, after which the situation will be reviewed. “The Valais is a large canton; the moratorium affects only seven communes. There is still demand for property and many wonderful resorts in which to buy,” says Andy Hawkins, of Chesterton International.
One way to buy in the Valais is through leaseback – that is, when a home is leased back by the owners to a management company which lets and maintains it. Savills and Alpine Homes have recently launched the second phase of Pracondu, in Haute Nendaz. The range of ski-in, skiout apartments come with a leaseback scheme guaranteeing a 4 per cent net guaranteed rental income for 15 years. They cost from £105,000.
Otherwise, Chesterton is selling eight luxury apartments, Les Chalets De Marie in Ovronnaz, which is untouched by the restrictions. South-facing, with a spa, the resort is as popular for its summer pursuits, as it is for skiing. A onebedroom apartment starts from £155,000. Still in the Valais, you can still buy in the family- friendly resort of Les Mayens De Sion. Chesterton is selling five bespoke chalets built by Alpin Chalet, the sister company of respected French builder Grosset Janin. With a distinctive style, combining wide windows and doubleheight ceilings, prices start from £740,000.
Meanwhile, the Vaud canton has no restrictions and has some delightful villages. One of the most popular is Villars. “It has a name for being low-key and laid-back,” says Larry Levine, of Alpine Homes. “There aren’t many English in the village – no more than 5 per cent.”
Alpine Homes and Savills have 10 luxury apartments in Les Cimes, the third phase of a 72apartment development, on the outskirts of Villars. Prices start from about £243,000 for a one-/two-bedroom home. There are stunning views of the Dents du Midi mountain, underground parking, and it is a 90-minute train journey from Geneva to Aigle, where you catch the 20-minute bus ride to the village.
On the village outskirts, in an area known as the Beverly Hills of Villars – Formula One driver David Coulthard has a £4.5 million chalet here – is Solalex, an Alpine Homes/Savills development of 14 four-bedroom chalets with garages and Jacuzzis – though you will need a racing driver’s salary to afford them: prices start from £1.08 million. There are stunning views, skiing on nearby Diablerets 3,000m glacier as well as walking in the picturesque neighbouring valley Miroir de l’Argentière.
More competitively priced apartments can be found with Overseas Homesearch, which is selling two-bedroom apartments in Residence Le Closel and Jardin du Closel A from £275,862, in Villars. Simon Triggs, a property consultant, bought a threebedroom penthouse apartment in central Villars with views of Mont Blanc, three years ago and it has already risen in value by 30 per cent. “I love Villars,” says Mr Triggs. “It’s beautiful and dual-season, so the summer is as good as the winter.”
Another area also open to foreign buyers, though still relatively unknown, is the German-speaking Bernese Oberland, in the Berne canton.Chesterton is selling Sun Brook – a collection of 12 bespoke luxury chalets by local developer At Home in the Alps, in Zweisimmen, near Gstaad. A five- minute walk from the village centre and ski lifts, prices start from £500,000, with completion next spring.
Legal charges are approximately 4.8 per cent. In the Valais they are 3 per cent. Foreign nationals cannot sell any property for 10 years. Rental yields in Villars on a 60 per cent mortgage are roughly between 4.5 per cent and 5 per cent.
Alpine Homes: 00 41 (0) 27 323 7777; www. alpinehomesintl.com; Savills: 020 7016 3740; www. savills.com; Chesterton International: 020 7201 2070; www.chesterton-international.com; Overseas Homesearch: 0800 6520 769; www. overseashomesearch.co.uk
To British ears, the moratorium on foreign buyers imposed in parts of the Swiss canton of Valais sounds pretty draconian. But looked at from their end, it makes sense.
Perhaps we could learn something from the Swiss about planning and economic sustainability, especially in the housing market. Many argue, and I am one of them, that Britain suffers from the kind of problem that they are trying to solve: house-price inflation and rural devastation caused by high numbers of second-home owners. This problem is also known as “cold-bed” syndrome.
Why do I believe this? My first job after college was in Cornwall and I remember sitting in a car in Rock, on a filthy winter’s day in 1995, unable to believe I’d bothered to go there. It was the most fashionable of West Country resorts and, off-season, it was impossible to buy a cup of tea, let alone lunch. In the longer term the mismatch between the cost of accommodation and my cub reporter’s wage made it impossible to remain in the county.
So when Verbier, in Valais, became similarly fashionable alarm bells rang. Over the past couple of years, a British horde, washed there on an economic tide, has poured over the mountains looking for somewhere to spend its money: the interest has been such that an estimated half of all wouldbe buyers in Valais are now from Britain. To regulate the numbers, the Swiss canton has a system of permits – only 310 foreign buyers a year, with a backlog now in four figures. The moratorium is in part to work through this backlog.
Philippe Landelle, of bespoke chalet developers Alpin Chalet, explains: “If you are a Swiss citizen, you can buy anything you like. But foreigners are restricted to owning 1,000 square metres of land, of which only 200 can be living space. Balconies and swimming pools are counted as one third of their actual size and if there are several generations of the same family hoping to buy together, exceptions can be made.
“It is still highly possible to buy in Valais – there are more than 90 communes unaffected by the moratorium. If you want to live, get a job, start a business, send your children to the schools, appreciate the quality of life or the tax advantages of being a pensioner here – that’s fine. No problem.
“But if you want to build a second home, you have to demonstrate that you will contribute to the local economy. You must agree to run it as a business ‘with service’ and persuade the local authorities that it will be successful. ‘With service’ means employing cleaners, cooks and laundry service. You must rent it out and this is to prevent what we call ‘cold beds’.”
I come from Norfolk, and I see this same “cold bed” syndrome happening in the north of the county. It’s what drives house prices beyond the reach of so many young people in rural areas, and has made enclaves in Cornwall (and other parts of Britain) economically inert. The consequences include low wages, closed schools and ex-post offices.
In Valais overall, 35 per cent of properties are now second homes – far more in the areas affected by the moratorium – and prices have risen by nearly 50 per cent above the Swiss average, according to the British estate agency Savills. This is possible partly because of our easygoing approach to credit that is foreign to the Swiss.
Whereas they have to pay 20 per cent of the value of a property at the outset and often, in fact, buy outright, we don’t. This contributes to our our own house-price inflation here in Britain and, the Swiss argue, is contributing to theirs.
The Swiss, with their steadfast refusal to join the EU, are uniquely able to resist our economic blandishments because they consider their social developments carefully. They know how this story ends and – let’s face it – they don’t need the cash enough to make the disruption worthwhile.
Inevitably, this makes a Swiss holiday home more of a prize for those who can’t manage without one and has the knock-on effect of pushing up prices for those who already own in Switzerland – mainly the Swiss, who have turned looking after number one into a political art form.
But there is a logic and sophistication to their wellthought-out, locally based and gradualist approach that throws our messy attempts to tangle with the same problems into stark relief.
The moratorium in Valais was announced uncharacteristically swiftly by the local government before Christmas; it was imposed in January, and took many by surprise. Initially, it will last a year and there has been talk of it being extended nationwide, although so far there has been no official response from central government.
“We are hoping that Berne will change its interpretation of the law to bring it more into line with ourselves,” said Jean René Fourniere, the Valais canton’s finance minister.
“But in Switzerland, if you want to change the law, it takes three or four years.”
Ultimately, the differences between the Swiss approach and the British are deep and cultural, rather than economic. Our planning system is such that even if we wanted to do something about the problem, our local politicians wouldn’t have the tools, because that’s not how our version of democracy works.
We have made our cold bed, so to speak, and our cultural mores demand that we lie in it. It is messy and muddled — but perhaps it is not all bad. Adrian Strittmatter, a Swiss national in his early thirties who works in the London property market, is an anglophile who sees the up-side.
“In Switzerland, property is regarded as a luxury. Most people rent from the same companies that developed their buildings in the first place and the pace of change is very slow,” he says.
“While this makes the place attractive if your main concern is stability, Switzerland is also incredibly boring for young people and it has one of the highest suicide rates in the world. Here you rush into your laws, get them wrong and then mess up even worse trying to fix it. And it doesn’t matter! That’s why I love Britain.”
‘Did David Hasselhoff End the Cold War? 50 facts you need to know: Europe’ by Emma Hartley (Icon, £7.99)
Alpin Chalet has several chalets available in Valais, starting from about £250,000. It can also provide detailed help on how to conform to Switzerland’s complex rules on where and how to buy. Details: www.alpinchalet.ch (00 41 27 329 05 62) or Chesterton International (020 7201 2070; www.chestertoninternational.com).
Open to offers: Grindelwald (above), in the Bernese Oberland, has escaped the ban on sales to foreign buyers. Below left, happy customer David Coulthard
Ready and waiting: homes for sale include those at Solalex, Villars, through Alpine Homes/ Savills (main) and, left to right: Les Chalets de Marie, Ovronnaz (Chesterton International); Residence Le Closel, Vaud (Overseas Homesearch); and Residence Les Cimes, Villars-Gryon (Alpine Homes/Savills)