London’s international superrich, with the threat of tighter regulation of their non-domicle tax status looming, are showing an interest in relocating to Geneva.
The news is hardly surprising, given that Switzerland has some distinct advantages, including low crime, low taxes and no wars since 1515. Many older British buyers also like the idea of guaranteed visits from their children during the skiing season.
A little money certainly helps, given the hefty entry costs to the market, but Swiss property is likely to prove a good investment. Prices have risen by about 40 per cent over the past five years, although the trend seems to be slowing, despite foreign buyers’ interest. However, one thing stands in the way of foreign buyers - Switzerland’s complex property regulations. There are rules at national level, more rules within the 26 cantons and yet more in the communes.
The appeal of a Swiss chalet is undeniable, however. A 90-minute drive from Geneva is Les Collons, at an altitude of 1,800m, where Investors in Property is marketing two resorts that are part of the Verbier Four Valleys resort (with 400km of pistes). Three of seven Matterhorn View chalets remain, and cost SwFr1,785,000 (£830,000) each. As the name suggests, they have splendid mountain panoramas; a buyer phoned from Australia to snap one up sight unseen. The interiors are spacious: five bedrooms, a spacious living room and a south-facing terrace. There is a utility room, spa bath and double garage.
The build quality is good, but the standard kitchen and fittings seem below par for this kind of money. However, Simon Malster, of Investors in Property, points out that customers are encouraged to install their own choice of appliances. The project offers an opportunity to see what the firm’s other Les Collons development will be like. The 20 five-bed chalets that make up Chalets aux Pieds des Pistes - 200m from the ski lift - are due to be completed in mid-2009. They come in three different designs and cost from SwFr1,395,000. The interiors can be “olde Swiss” exposed beams or smoothly modern.
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Helen and Nigel Hunter, who run a Calvados business in Normandy, bought a three-bed chalet near Matterhorn View from Investors in Property for £415,000 in 2006. It is now estimated to be worth £600,000. In the winter season they rent it out fully catered for £2,500 to £4,200 a week and in summer self-catering from £800 to £1,000. Villars, slightly closer to Lake Geneva, remains popular, especially with weekenders from Geneva or those with children at the four high-calibre international schools. Buyers include David Coulthard, whose villa is modest by Formula One standards. The pretty town thrives in or out of season (Lake Geneva is 30 minutes’ drive away, and skiing and golf are adjacent), it has many shops and good restaurants and its uglier buildings are gradually being clad in wood.
Savills is marketing two developments here for Alpine Homes. The Residences Mont D’Or (three-bedroom apartments from £478,000), which will be ready for December 2008, have good views towards Mont Blanc. But their prime new-build is Hameau de la Forêt. Four- bed chalets (from £865,000) are only minutes from the slopes and have such features as a spa bath and built-in barbecue. The exterior can be built in old wood to give a more natural effect.
Switzerland seems to offer steady returns and good appreciation, and the capital gains tax goes down from 30 per cent to 14 per cent after ten years (and to 0 per cent after 22 years). However, sales can take months and bizarrely it is difficult to buy a property with an interior of more than 200sqm if you are a foreigner.
Now, the bad news. The Swiss are relaxing rules for foreign buyers - but only under pressure from the EU. The upshot is that there are only 1,500 permits allowing foreigners to buy outright issued annually for the whole of Switzerland. The permit allows you to buy or sell your property at will. You can still “buy” a property without a permit, however, the ownership will reside with the builder until you obtain a permit, which can be years. There are several different types of permit and you may be able to buy with them, depending on whether you are working, visiting or letting.