Chalets and flats in Swiss Alps are becoming a luxury

Prices for holiday flats in the Swiss Alps rose the most in Arosa, by almost 18%. KEYSTONE/ Arno Balzarini

Prices for chalets and apartments in the Swiss Alps continue to soar. According to a new survey, prices rose by 4% in the first quarter of 2024 compared to a year ago.

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Verbier has overtaken St. Moritz. The chic mountain resort in canton Valais is the most expensive tourist destination in the Alps for holiday homes. A square metre costs CHF21,500 ($23,544) there. Zermatt follows in third place.

These are the findings of a new property study by UBS bank. It found that the average price per square metre for second homes in the first quarter of 2024 “in the high-end segment” rose by 4% compared to the previous year.

Prices for holiday flats in the Swiss Alps rose the most in Arosa, by almost 18%. UBS property expert Maciej Skoczek explains the price trend by saying that the Graubünden municipality is easily accessible from the affluent economic areas of Zurich and Zug.

According to UBS, Arosa also recorded the highest price increase of all the destinations analysed over a five-year average.

Locals fear for their livelihoods

The victims of the high demand for holiday flats are the residents of the tourist areas, including Arosa. This leads to fears for their livelihoods, says municipal president Yvonne Altmann.

The reason is that the prices of “old-law” flats are being driven up, i.e. flats that were built before the second-home initiative was adopted in 2012. These may be converted into second homes and enlarged by up to 30% in the event of a conversion.

“This has led to entire apartment blocks being bought and demolished and sold at a high price,” says the mayor. This drives up prices to such an extent that long-term residents and workers are forced out of their flats. Others, on the other hand, are making money from the sale of flats.

Price increase in Verbier

In the already expensive Verbier – known primarily as a winter sports resort – prices per square metre have recently risen by about 10%. The town in the municipality of Val de Bagnes is now the most expensive place for holiday homes in Switzerland.

The UBS property expert cites “strong international demand and the relatively small supply of living space” as reasons for this.

Recently there were rumours that the largest ski resort operator in the world, Vail Resorts in Colorado, United States, wanted to buy the Verbier ski resort and mountain railways after Andermatt and Crans-Montana. UBS cannot confirm whether these intentions have driven up prices.

Foreseeable price stagnation

But as a result of the strong demand for holiday flats in recent years, the market remains dry. This is probably one of the more important reasons for the price increases.

According to UBS, only 0.7% of all flats in Swiss tourist communities are currently vacant, which is around 50% less than before the pandemic.

The peak has probably been reached for the time being, says Maciej Skoczek. UBS expects prices to stagnate – as they did last year. UBS had already spoke of a “normalisation of demand” in the last few quarters.

Adapted from German by DeepL/dkk/sb

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