Mon Dieu! Chamonix Ski Chalet Values Crash

When times get tough buying a ski chalet in the Alps get prioritised behind groceries and medical bills, we guess…

Bloomberg: U.K. demand for ski properties has helped drive Alpine prices higher for at least six years. Now, values are plunging, as the worst financial crisis since the 1930s and this year’s 22 per cent decline in the pound against the euro deter buyers. Chamonix gets half its foreign visitors from Britain and prices have dropped by as much as 20 per cent, says Craig Widdicombe, who sells houses in the area.

“The whole mountain economy is suffering,” says Gabriel Mingeon, sales director at Annecy, France-based MGM Immobilier, one of the biggest real estate developers in the French Alps. “The British are big consumers.”

U.K. clients accounted for about 12 per cent of MGM’s 360 sales this year, compared with 18 per cent of 420 sales in 2007.

“The British are the drivers in the market because as soon as they buy, the French see it and start to get interested,” he says. “They gave the system its dynamism.”

…The U.K. economy shrank 0.6 per cent in the third quarter, the worst decline since 1990, while the European Central Bank reckons the euro region will contract 0.5 per cent next year.

In Chamonix, 88 kilometers (55 miles) from Geneva, the pound’s “crippling” decline is making it harder to attract Britons, says Simon Warren of Agence Montagne, a real estate company in the town. The pound depreciated to 95 pence per euro yesterday in London, from 93 pence at the end of last week.

“Our biggest problem is that nobody needs a chalet in the Alps,” says Warren, as he surveys the plat du jour of Thai chicken at Chambre Neuf, a bar opposite Chamonix train station. “It’s the ultimate discretionary spend.”

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