Austria - the pick of off-piste propertyPosted on: 03 January 2012 by Laura Henderson
Eccentric but snow sure, Austria’s Belle Epoque resort of Bad Gastein is back in the property spotlight - for all the right reasons, says Laura Henderson.
“The local architecture was inspired by Emperor Franz Josef who came to the area for the natural healing waters,” explains Alexandra Putz of the Regional Tourist Authority. “He was so taken with the setting that he instructed Italian architects to design many of the buildings that you see today, including the oldest casino in Austria.”
The 1950s saw the resort’s popularity grow as a winter sports destination, when it hosted the World Ski Championships. Today, it functions superbly as both a world-class ski resort and a genteel spa town, although its vintage grandeur is starting to look faded compared to nearby rival resorts. Now with an ambitious £10m investment programme underway, a fledgling residential tourism market is taking hold, bolstered by one of the fastest-growing winter tourism levels in the country.
“Natives of the French Alps have long been accustomed to selling houses to foreigners,” explains Simon Malster of Investors in Property, “but the Austrian property market is nascent due to previous restrictions on foreign ownership. Before the country joined the EU in 1995, only nationals could purchase property and development was small scale. Now the market is maturing and its appeal is growing with a sales pattern similar to Switzerland, where a ski destination relatively unknown to the international market starts to become a viable second-home option.”
“House prices are attractive,” enthuses Pamela Cooke of Leeds-based developer Austrian Chalets. “While the property market in the rest of Europe has been expanding over the past ten years, house prices in Austria have remained flat, with relatively few homes exchanging hands and sales handled by banks rather than estate agents. Traditionally most Brits have headed to France for their annual fix of the white stuff, but with prices levelling off in mainstream resorts, many are starting to look elsewhere. Austria has remained relatively hype-free and people are beginning to realise just how far real estate values have to grow.”
Boasting over 200km of downhill skiing up to an altitude of 2,600m, and four main ski areas, the Gastein region forms part of the vast Ski Amade circuit offering 860km of skiing on one pass. A combination of 48 lifts-an array of gondolas, cable cars a funicular and high-speed chair lifts means there’s plenty of terrain to explore over a couple of week’s skiing.
“Fewer than 20,000 people live in the valley,” says Putz, “yet more than 2m visitors come for the holidays. The British account for just 3% of the total - but the number is growing thanks to tour operators expanding their portfolio and a solid network of no-frills flights from UK regional airports. The resort also enjoys a long season from December to May and a good snow record thanks to its high altitude.”
Continuing re-investment in modern lifts, snowmaking equipment combined with upgraded leisure facilities, are indications of the determination of the Valley to lure visitors. An asset for hundreds of years, the healing and beneficial effects of the Gastein thermal waters formed by water and rocks, mediates a unique atmosphere.
“The Alpen Therme in the town centre is Europe’s most modern Alpine recreation,” adds Putz. “We’ve six health zones and a sauna sphere with bathing lake and vapour baths. A million litres of thermal water from 17 springs feed the thermal-spa pools.” Come summer, the resort takes on a fresh-air vibe, the national park a veritable treasure trove for hikers, bikers and golfers. “We’ve an 18-hole championship golf course on the town outskirts,” adds Putz, “plus over 350km of marked trails that take you across mountain pastures. Kids love the hill farms which are easy to reach by mountain lift.”
Property wise, choice is opening up, with a growing number of chalet restorations to balance the quota of ‘hands-off’ self-contained new-build projects. A popular spot with families is the tranquil outlying district of Bad Hofgastein.
“A large chalet will set you back in the region of £190,000, £250,000 for a pristine ready-to-move-into version, while renovated farmhouses can be picked up for £130,000,” confirms Gerhard Lafenthaler of local agents Lafenthaler Immobilien. “Plus you’re only minutes from the lifts with a regular ski-bus service running throughout the day.”
Surrounded by wooded meadows and farmland and sporting panoramic mountain views, the agency is marketing a beautifully restored timber clad country house with winter garden, double-glazing and bright, airy rooms. Spread over two floors, the property with a price tag of £325,000, comes with three spacious bedrooms, two bathrooms and a large open plan living room with picture windows.
Blending into its vintage surrounds with its classic 1920s mansard roofs and wrought iron balconies, Sonnewende boasts a prime cliff top location above the town’s waterfall. Accessed by a private lift, which whisks residents down to the town, the complex will comprise just 26 apartments with a choice of interior finishes. Buyers also have the option of combining two apartments to create a spacious single-floor penthouse. One-bed apartments with Investors in Property start from £185,000 rising to upwards of £206,000 for a two-bed unit.
Head to the hilly outskirts and adjacent to the Bad Gastein Golf Course is the valley location for Resort Gastein. Comprising 19 two and three-bedroom chalet style residences and due to complete for winter 2010, properties come fully furnished with laundry area, heated ski storage and underground parking. Ultra-modern leisure facilities include a gourmet restaurant swimming pool, wellness centre and relaxation zone.
“Property purchase in this particular development is tied into a rental pool system,” Malster explains. “Owners have up to four weeks personal use per year, split between peak summer and winter seasons, with unlimited use during the low season provided the unit is not let. Owners may opt to take a variable income of a fixed guarantee, which starts at 3 per cent in the first year, 5 per cent in the second year and rises to 6 per cent in years 3, 4, and 5. It’s a high return for a ski property as it’s a dual season resort.”
Prices for a two-bed apartment start from £230,000 rising to £300,000 with Investors in Property.
Each province (Bundesland) imposes restrictions on ownership of property and in some regions such as the Tirol, it is almost banned completely for holiday use. Buyers are required to have their purchases approved by the appropriate Grundverkehrsbehorde-part of the local authority.
A deposit of 10% is usually payable and then a purchase agreement is drawn up and signed by both parties. Both the purchaser and the vendor are required to attend at the notary’s office to sign the deed of sale, although parties can assign a power of attorney.
Neither purchaser nor vendor can back out, which prevents gazumping and means the finance must be in place before you can make an offer.
Purchase costs work out about 6% of the purchase price, including purchase tax ‘Stamp duty’ of 3.5%, entry to the Land Registry of 1% and notary’s fees of 1.5%.
Estate agents fees are controlled by law and typically cost both buyer and seller 3%.
Austrian banks will fund up to 70% of the purchase price with a loan period typically between 15 and 25 years. Some banks charge a set up fee of around 2%. They will also charge an appraisal fee of 0.5% and you will need to pay a 1.5% mortgage registration fee.
Capital Gains tax is set at 50%, although main residences are not liable for CGT after 10 years of ownership.
By Laura Henderson
Property journalist, columnist and author
Laura is a UK-based property journalist and author specialising in domestic and overseas markets. A regular contributor to the Financial Times, Sunday Express, Daily Telegraph and Homes Overseas magazine, she also edits a monthly property column for the Scotsman newspaper and is the author of several on-line investor guides for among others, Channel 4 Homes.
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