Holiday Apartments in the Alps have become 10 Percent more Expensive

Strong price increase for holiday homes in the mountains
The prices for holiday apartments in the mountains have risen sharply in the past year. This development was favored by the corona-related higher demand and a shortage of supply.

According to a study by UBS on Tuesday, holiday apartments in the Alps have become 10 percent more expensive on average in 2021. That was the strongest increase since 2008. Buyers in all regions had to dig deeper into their pockets.

St Moritz most expensive

According to the survey, St. Moritz in the Engadine remains the most expensive place in the Alps. For a holiday apartment of a high standard, you currently have to pay CHF 19,500 per square meter – that’s almost 11 percent more than last year. It is followed by Gstaad with CHF 17,000 (+5%) and in third place is the Jungfrau region, where prices per square meter have risen above average by 16 percent to CHF 15,900 within a year.

Price increases of more than 15 percent were also recorded in Arosa, Engelberg and Flims/Laax. At the other end of the scale, holiday homes in Adelboden/Lenk only increased by just under 1 percent.

According to the study, the cheapest apartments are in the Valais towns of Evolène and Leukerbad, each at just under 6,000 francs per square meter.

Corona and second home initiative

The authors of the study attribute the increasing demand for Swiss holiday properties to the corona pandemic. According to UBS, the travel restrictions and the obligation to work from home have triggered a “big rush” for holiday apartments. The decoupling between place of work and place of residence has also led to many households choosing a primary residence in the mountains.

On the other hand, the “de facto construction freeze” due to the Second Homes Act in the tourist regions has restricted the range of available holiday homes. Measured against the stock, only around 0.25 percent were approved for construction there, which corresponds to a long-term low, they say. In addition, first homes in particular would have received a building permit.

expected slowdown

Prices should continue to rise in the current year, albeit somewhat more slowly than in the previous year. On average, the experts expect an increase in the mid-single-digit percentage range for 2022. The higher the price level, the smaller the group that can afford a holiday apartment.

In addition, some owners want to sell their apartments in view of the current “price boom”, which in turn increases the supply. According to the authors of the study, the higher interest rates and increased maintenance costs should also motivate many owners to sell.

The total usage costs of an average holiday home are now a good third higher than before the start of the second home boom in 2020.

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Summary

The prices for holiday apartments in the mountains have risen sharply in the past year. This development was favored by the corona-related higher demand and a shortage of supply.

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