An Overview Of The Ski Property Market in 2021/2022
After two years of forced closures and, for some, ongoing travel restrictions, the global ski residential property market is benefiting from pent-up demand and a new need for the great outdoors.
The prime residential ski market has proven surprisingly resilient, despite nearly two seasons of closures for most resorts. Supported by favourable monetary policies and low-interest rates, high-end real estate is an attractive place to invest, and ski real estate has benefited.
As an outdoor activity in an age of social distancing, ski resorts have an obvious appeal. Sustained demand for ski properties means that the major residential markets for most resorts have seen their prices rise over the past 12 months. While the ski industry faces long-term challenges, investments in infrastructure and new technologies are attracting new enthusiasts to the sport, while helping resorts maintain a competitive position in the larger real estate market.
Early resort closures and strict travel restrictions during the 2019/20 season have resulted in the worst number of skiers in the past twenty years, with just under 300 million visits. In addition to the abrupt end of the 2019/20 ski season, the 2020/21 season has failed to start for many ski resorts.
Due to the Covid-19 pandemic, ski resort visits around the world declined by 18% during the 2019/20 winter season, with the largest drop of 31% in Asia and the Peaceful.
However, there were notable exceptions; the National Ski Areas Association recorded 59 million visitors to US ski resorts for the 2020/21 season. Much more reliant on national skiers, this was the fifth highest volume since the start of the season records in 1979. Likewise, Swiss resorts opened with few restrictions and did not fare as badly as some of their neighbours in terms of the number of skis. There is also growing hope for the next 2021/22 global ski season.
Invest for the future
Vulnerable to climate change and highly dependent on tourism, ski resorts are constantly investing in their infrastructure to attract visitors and remain competitive. New developments in the Alps include a 40 million euro ski lift link between Val Thorens and Orelle in the Three Valleys (France), Zermatt (Switzerland) adding a new cable car connecting the resort to Cervinia (Italy) and Flims, Laax (Switzerland) the completion of the development of the world’s longest tree-top walkway.
Beyond the Alps, Colorado ski resorts have increased the size of their land offerings. Steamboat opened 355 acres north of the resort, and McCoy Park expanded by 250 acres in Beaver Creek. Lake Louise in Canada has also opened an additional 480 acres.
Ski services receive a technological upgrade
Social distancing during the Covid-19 pandemic has encouraged many ski resorts to improve and update their services. Catalyzing change within the industry, the pandemic has prompted resorts to offer online services for lift passes, courses and rental shops.
Ski France offers a new contactless chalet dining experience, where guests arrive at fully stocked refrigerators, easy recipe plans, and pre-booked ski gear.
Catalysing change within the industry, the pandemic has prompted resorts to offer online services for lift passes, courses and rental shops
Some resorts, like Zermatt, have gone further by offering home delivery of ski equipment to residents and guests. This service creates a tailor-made and personalized experience, and customers no longer have to set foot in a ski shop.
The industry suffers from low participation among the younger generations, so these technological advancements will also help attract a younger, tech-savvy skier which is vital for the future growth of the industry.
Improve your carbon footprint
The ski industry is very aware of its environmental impact and the threat climate change poses to the industry. The Flocon Vert has been awarded to ski resorts since 2011 to increase their actions in favour of the environment.
A recognition of sustainable development is a distinction highly sought after by the resorts.
A visitor’s mode of transportation contributes 73% of a ski resort’s average carbon footprint, according to a 2007 study. Train travel, wind and solar lifts are some of the ways in which stations strive to reduce their carbon output.
The recently re-commissioned ski train connecting St Pancras station, London to Moûtiers and Bourg-Saint-Maurice, France, will be exclusive to vacation packages purchased for six selected resorts. These vacations will have a very low CO2 production per skier, compared to flying or driving.
In addition, EcoSki, the leading online sustainable ski wear store, offers ski wear from brands that boast sustainable credentials, repair service and a platform to resell ‘pre-loved outerwear.
Lack of supply and pent-up demand to fuel growth in ski property prices
The ski industry has enjoyed a renewed appreciation for the outdoors. Sport offers fresh air, open space and minimal human contact compared to other types of leisure activities. Lifestyle changes and working from home have also increased the demand for cabins and apartments in hill stations.
The combined under-supply at major resorts and increased demand since the second half of 2020 has led agents to report ski property price increases of more than 5% in the past 12 months.
The dynamic nature of ski resorts, many of which are adjusting their infrastructure and leisure offerings to remain competitive and ensure their future viability, will likely encourage strong residential price growth in the future. This is reflected in increased demand from investors seeking to acquire commercial real estate assets in major beach resorts.
Skiers can’t wait to get back to the slopes. As international travel picks up, despite continued challenges, residential property values and ski vacation bookings reflect pent-up demand in the industry.
As countries and resorts refine their Covid-19 policies and implement necessary security measures, industry sources are reporting that bookings are up from pre-pandemic levels.
A limited supply of pipelines, restrictions on residential real estate development and growing demand are driving up residential property prices at many ski resorts. As a result, the purchase and rental markets should benefit this season, with growth expected to continue over the medium term.
CHINA’S SKI MARKET POTENTIAL
2022 will see China host its first Winter Olympics, in Beijing. The $3.9 billion event is a statement of intent for Chinese winter sports and is set to cement the country as a major player on the international ski scene.
Participation in winter sports in China has risen in the last two decades. Average skier visits in China grew by 13% between the 2017/18 and 2019/20 seasons, according to Laurent Vanat, and the Chinese government is aiming to engage 300 million Chinese people in winter sports by 2025.
In contrast to Europe’s ageing pool of skiers, 80% of skiers in China are under the age of 40
Today, there are a total of 770 ski areas in China, and a further 28 new ski areas opened in 2019 alone. With so many first-time skiers, China is also seeing new skiing concepts emerge, such as Snow51, an innovative indoor ski leisure experience created in partnership with an Austrian ski training institution.
In contrast to Europe’s ageing pool of skiers, 80% of skiers in China are under the age of 40. Per capita income is expected to grow by 59% by 2027, creating a large middle class with disposable income to spend on leisure.
Japan receives the largest inflow of Chinese skiers, already representing the largest such inflow in the Asia-Pacific region. As China’s ski industry matures, Chinese skiers are likely to venture further afield. Europe, offering a depth and variety of luxury ski resorts, is well-positioned to benefit.