Property price report

Recent figures in the September edition of l'Express magazine show that property prices in the French Alps have held up well in the face of the global crisis. Aided by a wealthy international client base, low interest rates and tax breaks for French buyers, the property market in Haute-Savoie remains relatively stable despite a decrease of 20-30% in the overall volume of sales.

In the region's capital, Annecy, prices of resale apartments have fallen by an average of 4%. Compared to the French national average of -10%, this represents an encouraging performance for the "Venice of the Alps". The outstanding quality of life the town has to offer combined with continued investment by local and international businesses has contributed to Annecy's popularity with buyers. Lakeside villages and apartments in the central "Golden Triangle" of Annecy centre are still sought after locations and properties in popular residential suburbs such as Annecy-le-Vieux continue to successfully outperform the national average.

Globally property prices of resale apartments in Haute-Savoie have decreased by an average of 4%, however ski resorts have fared more favourably and prices have slipped by an average of less than 3%. Some resorts have reported price increases, such as Chamonix, Les Houches, Samoens and Manigod, whilst others have seen a slight decline. Morzine and Saint Gervais property prices are almost at a standstill at -1%, whilst Le Grand Bornand, La Clusaz and Les Contamines are showing minimal declines of 2-3%.

Whilst many agents will certainly be grumbling about a decrease in the volume of overall sales, most agree that the months since the end of April 2009 have shown increased activity in both the number of buyers entering the market to start their property search and the number of monthly sales agreed. In recent weeks we have seen a flurry of activity as confidence returns to both the banks and buyers and a number of great-value, high quality properties have recently sold.

The ski resorts of the French Alps have always had a shortage of property for sale and despite the global crisis there was not a sudden influx of distressed stock into the marketplace - the Alps is a second home market with affluent owners, unless a major change in personal circumstances forces a sale, many would-be vendors are biding their time and holding off marketing their property.

The current market position is good news for buyers - there is still a greater selection of property on the market than in previous years and there is a hugely varying degree of negotiation possible dependant on the personal circumstances of the vendors. Interest rates with the French banks we work with are at a record low, French buyers have re-entered the market and the general consensus is that the alpine property market is starting to pick up again. With the busy buying months before the ski season ahead of us, now is a great time to invest in your dream alpine property.

Samoens bargains

Spring is in the air in the valleys of the French Alps, the sun is shining and the first of the springtime flowers are bursting out in a riot of colour. Up in the mountains it's a very different story and the deep snow is still providing excellent coverage over the ski pistes.

It's a fabulous time of year to hit the slopes; there's something so gratifyingly indulgent about enjoying a hearty alpine lunch on a chalet terrace in the blazing sunshine - drinking in those never-ending mountain views and whiling away the time relaxing in a deckchair or burning it all off on-piste - especially if the rest of the world is at work!

This week I was in the Grand Massif ski domain visiting property with some clients and they were totally bowled over by the area, the variety of activities available for holiday makers and the value for money that this part of the French Alps currently offers. There are some excellent springtime bargains out there and they certainly won't be around forever.

Already this month we have seen a huge increase in the number of contacts from prospective buyers and it's shaping up to be an excellent second quarter. Our contacts across the region are reporting a similar story, so it's a case of get in there quick, before the bargains are snapped up by other savvy buyers. As mortgage rates are at the lowest we've seen for a good while (our French mortgage contacts are offering rates from as little as 3.75% variable) you can even off-set your sterling-euro exposure for a few months - and perhaps clear the loan without penalty when the exchange rate strengthens. It's an excellent time to buy property in the French Alps, so why not strike whilst the raclette pan is hot?

To see a selection of the fantastic property we have for sale in Samoens in the Grand Massif, take a look at the following reference numbers on Ascendant's Buy Property page:

Reference 1327718 - 179,950 euros
In Samoens centre, two double bedrooms, large balcony, parking and ski locker.

Reference 1407041 - 220,000 euros
Samoens centre, newly built, 2 bedrooms, terrace, fully furnished and equipped, underground parking, cellar and ski locker, rental returns of minimum 5% p.a. and reduced notaires fees.

Reference 1254105 - 227,900 euros
Central location, two bedrooms, sunny terrace, ski locker, private garage, immaculate condition.

Reference 1414530 - 249,000 euros
Samoens centre, in a charming character building, 2 double bedrooms, 2 bathrooms, sold fully furnished and equipped.

If you'd like to arrange a viewing of the above property, please contact the Ascendant team.

For more information on Samoens and the Grand Massif area, please visit our Area Guide.

Now is the time to buy in the French Alps

Here we look at some of the reasons why now is the ideal time to start your alpine property search with Ascendant.

The best selection of properties
There has never been a better selection of chalets and apartments for sale in the French Alps. In previous years it was almost impossible to find affordable properties on the market near the pistes or ski lifts; nowadays there are many more possibilities although the best examples still sell quickly when priced correctly.

Price negotiation
In recent years, a large number of British residents have purchased permanent or second homes in Alpine resorts such as Chamonix, Morzine, Les Gets and Samoens. Depending on the date of purchase, many of these people will have seen huge growth in the sterling value of their property, simply because of the change in exchange rates. For example, in 2007, a British buyer purchasing a 600,000 EUR chalet would have spent around GBP 400,000. Today, converting that 600,000 EUR back generates over GBP 540,000. Some of our British vendors will benefit from this phenomenon and are therefore more open to negotiation on price.

Cheaper mortgages
Mortgage rates have dropped dramatically and there are some very attractive rates currently available with our French finance partners. Some British purchasers are reducing their exposure to the current exchange rate by taking out a French mortgage to fund their purchase; by doing so they are not required to convert the full amount from pounds to euros straight away.

Rentals potential
Low mortgage rates and high rental occupancy in alpine resorts means it is once again possible to purchase a holiday home which covers its own costs. Resorts like Chamonix, Morzine and St Gervais have excellent rental potential in both winter and summer seasons. It is increasingly possible to purchase resale apartments and chalets with existing rental agreements in place, which means it is possible to start making money almost from Day 1. For instance, we are currently selling a three-bed, two bathroom apartment in St Gervais for 290,000 euros; the apartment has an excellent rentals history with bookings in place for the coming year. New-build leaseback schemes are also worth considering: for the investment purchaser they provide a guaranteed rental income of up to 4.2%, full property management and a VAT rebate on purchase (currently 19.6%).

Long term potential
Investment remains an important factor for many property buyers, especially with share prices deflated and savings rates reduced. Property prices in the French Alps have increased consistently over the last 10 to 20 years, driven by demand from discerning international buyers for alpine chalets and apartments. Prices this year are not expected to grow due to the economic downturn however prospects for continued long term capital growth remain excellent: strict building regulations in this part of the world ensure that supply remains restricted.

Releasing equity?

If you are the owner of a ski apartment or chalet in the French Alps we would like to highlight the opportunity of arranging an equity release on your French property. As you probably know, equity release means you can release capital tied up in your property in France for home improvements or even a personal project without an obligation to demonstrate the use of the funds to the bank.

The combination of the weak pound, the price falls in the UK residential property market plus the drying up of mortgage supply in the UK might prove to be the right time to organise an equity release in Euros from your French property.

Ascendant’s long term partnership with one of the leading French mortgage specialists means that we can help non-residents to arrange mortgages for our clients. Our partners have an agency based in Annecy and their English-speaking mortgage advisor is available to draft quotations for you via email or over the telephone.

If you already own a ski or lakeside property in this part of France with or without a mortgage on it, our partners can offer you a release of funds up to 70% of the net value of your French property.

A large number of our clients use equity release to fund renovation on their French property e.g. build a swimming pool or just making their property debt work in order to build their property portfolio and overall net wealth.

If you would like to know more about how we can help you to release equity on your French property, please contact us for more details.