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With Alpine views Swiss holiday homes becoming cheaper to buy

Plenty of newly built holiday homes in Swiss tourist destinations remain empty


The cost of owning a holiday home in the Swiss Alps has declined appreciably in many towns and villages in the last five years. The biggest falls in property prices have been observed in the last 12 months, according to UBS bank researchers.

Prices have dipped anywhere from 3% to 9 % year-on-year in some of the best-known Swiss tourist destinations, such as St Moritz and Verbier. This contrasts drastically with steadily increasing housing costs in the French and Austrian Alps, UBS says.

UBS blames the plunging Swiss holiday home market on the strong franc combined with a referendum in 2011 to limit the amount of second homes constructed in popular mountainous regions. The successful ‘second homes’ vote paradoxically led to a construction boom as builders raced to beat the deadline of when the initiative was finally implemented, in 2013.

The increased building rates have been accompanied by rising vacancy rates in many communities. The sudden strengthening of the Swiss franc against the euro and other major currencies in 2015 has also cooled demand for property from outside of Switzerland.

The first edition of the UBS Alpine Property Focus shows the cost of purchasing a property home in Lenzerheide as falling 9.1% in the last year, Laax (Graubünden) by 7.3% and Davos/Klosters (all in canton Graubünden) by 5.2%.

St Moritz witnessed a 3.4% fall, while the popular tourist destination of Verbier, in the French-speaking canton of Valais, saw a 6.1% decline.

map of Switzerland showing change in holiday apartment prices (percentages) across the country

In the past year, property prices have fallen in many popular resorts. (UBS holiday home study)


Still expensive

However, holiday homes remain far from cheap despite the price reductions. Buyers can expect to pay above CHF14,000 ($14,500) per square metre in St Moritz and Gstaad. The highest prices in other Alpine regions, such as Courchevel in France and Austria’s Kitzbühel, weigh in at under CHF12,000 per square metre, UBS calculates. But property prices in these areas is also steadily increasing.

UBS researchers forecast further reductions in the cost of Swiss holiday homes. “Greater mobility in vacation habits and sharing economy platforms such as Airbnb are lowering demand for the ownership of vacation apartments,” the bank says in a statement.  

“And the most important group of potential buyers, the 50–55-year-old age group, will shrink in the next few years. A generation change of vacation properties' original purchasers is also taking place, raising the availability of apartments on the market.”

Demand for Swiss property from abroad may also take a hit in future if parliament decides to further tighten conditions for foreigners buying bricks and mortar. Politicians are currently reviewing the so-called Lex Koller regulations to see if they could be made more stringent.

Property law reform Foreigners could suffer under new building restrictions

Swiss politicians and investors are at loggerheads over government plans to tighten the laws on non-EU citizens buying property.

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