Is a ski apartment a good investment? The short answer is yes. As a result of the potential for a high return on investment and lower ongoing costs, it is usually an attractive choice.
However, those considering investing in an apartment in the Alps will know there are other factors to think about. At OVO Network, we are often asked:
- What is a better investment: a ski apartment or a ski chalet?
- What are the pros and cons of investing in a rental apartment in the Alps?
- What criteria should a successful holiday rental apartment meet?
In this post, we answer these questions and share other key insights into property prices, taxes and copropriété (co-ownership).
Rental apartment vs rental chalet
The first thing you need to establish is whether you want to invest in a ski apartment or a ski chalet. And ultimately, like with any decision, there are positives and negatives associated with each investment.
At OVO Network, we don’t advocate strongly for one over the other, as it is down to personal preference. However, we can share the pros and cons of investing in a ski apartment to help you make your decision…
Pros of investing in a holiday rental apartment in the Alps
1. Lower buying price per m2
Generally speaking, from what we can see in the chart below, apartments tend to be cheaper per m2 than chalets across key destinations in the French Alps. Therefore, if you’re looking to make a slightly smaller investment, an apartment could be for you.
Do bear in mind, that depending on the specific geographical location, resort facilities, general infrastructure and ambience, the property prices in different ski resorts vary enormously.
Some lesser-known areas can be as low as €1,000 m2, whilst a new build apartment in a top-name resort might command in excess of €25,000 m2.
Within resorts themselves, there can also be huge variations in the price per square metre. The quality of the chalet or apartment will be an important factor, but the distance from the bars and shops will be key, as will the location of the closest lift or piste.
Properties that are an easy walk from the slopes can command a premium of over 12.5% above those that are a 15 to 20-minute walk away.
Another perk for some buyers is they see investing in an apartment as a cheaper and less risky option, compared to taking the plunge and investing in a chalet.
2. Lower ongoing costs
If you invest in a rental apartment, most of the time your ongoing costs will be lower compared with those of a ski chalet. Therefore you can expect more affordable bills for the following:
Energy consumption
Apartments are smaller properties with less capacity than a chalet. As a result, generally speaking, owners of apartments will incur cheaper energy bills than owners of ski chalets. This is also largely down to the absence of high-consumption features such as hot tubs and pools and home cinemas, which will of course increase energy bills.
Mortgage repayments
Mortgage repayments will generally be lower for apartments than they will be for chalets. Do note that this will vary if you buy a super-luxury apartment in the centre of a very affluent destination, which may cost more than a small, remote chalet in a less popular location.
You pay less tax
Another significant advantage of investing in a ski apartment is that you’ll benefit from reduced tax. “Taxe foncière” and “taxe d’habitation” are a couple of examples which you usually pay less for if you own an apartment compared to a chalet.
The topic of taxation on second homes is detailed and extensive. We’d recommend reading our comprehensive guide for full details.
Maintenance and cleaning
As apartments are much smaller than chalets, you’ll tend to encounter fewer maintenance jobs. For example, a chalet with a large outdoor area will require gardening throughout spring and summer, whereas an apartment may just have a balcony.
The same goes for cleaning fees, as cleaning an apartment will usually take much less time compared with cleaning a chalet which may be able to accommodate 8 or more guests.
3. High return on investment
Holiday rental apartments in the French Alps offer a high return on investment. At OVO Network, we are seeing a real demand for properties that can accommodate up to 6 guests.
These types of properties are ideal for small families or couples looking for a romantic getaway, for example. And properties located in high-demand resorts in central locations (close to the pistes and the village) which are available in peak-season can be extremely profitable.
4. Copropriété scheme
“Copropriété” refers to the concept of co-ownership in France. This is common with apartments located in a larger building/block. Owners will own the private parts of their property and then share a percentage of the common areas such as hallways, outdoor areas, parking spaces, shared swimming pools, etc with other co-owners.
Often with this structure, the “syndic” or the building management company will govern meetings and voting to facilitate the decisions of the copropriété organisation.
Some owners prefer this kind of arrangement, for example, if they are very busy or don’t live close to the property, as they do not have to be primarily responsible for the upkeep of the entire building. Additionally, foreign investors who may not speak French can take comfort in the fact that maintenance jobs are being handles on their behalf.
With this scheme, apartment owners pay a service charge to the building management company and can avoid spending their stay taking care of tasks such as…
- Snow clearing
- Gardening
- Landscaping
- Maintenance and weather-proofing of exterior areas
5. Peace of mind
Another key factor which appeals to many owners who purchase ski apartments is the fact that security shutters, alarm systems and high security front doors are frequently included as standard with new builds.
Plus, living in an apartment sometimes means it’s easier to organise regular management checks, and that close neighbours who may live in the building year-round might also keep an eye on your property.
Finally, and perhaps most importantly of all, apartments are easy to walk away from at the end of the holiday. Some second home owners simply prefer to simply lock up and leave.
Cons of investing in a ski apartment in the Alps
1. Less privacy
Apartments are usually in shared buildings, therefore limiting the level of privacy that can be enjoyed by you and your guests. For some, this isn’t an issue, but others may prefer the more secluded, exclusive experience offered by stand-alone chalets.
2. Reduced space
Compared to chalets, apartments are more restrictive when it comes to space. Some holidaymakers will prefer to spread out in a chalet and might find an apartment too small for their needs.
Fewer facilities
Another result of reduced space is that you can’t offer as many additional facilities as you can with a chalet. Many owners of apartments will choose to prioritise accommodating guests before investing in added extras.
For example, it makes more sense for an owner of a large-capacity chalet to use spare space for a home cinema, sauna or swimming pool.
However, this generally isn’t possible for owners of apartments, who won’t have the same flexibility. In some cases, if an apartment has ample balcony space, owners may be able to invest in a hot tub. However, this depends on building regulations and the ease of installation.
Either way, it’s imperative that the guests’ safety and comfort is not compromised. Always abide by the minimum space requirements and remember that overcrowding your property is not conducive to a luxury experience.
What criteria should a successful ski rental apartment meet?
Next, you need to understand what makes a great high-end rental apartment in the Alps. We’ve narrowed down the key factors below:
1. Size and configuration
The size and configuration of your rental apartment are key to your guests’ comfort and satisfaction.
One example is aiming for a high bedroom-to-bathroom ratio in your apartment. For instance, in a 3-bedroom apartment, having 3 bathrooms (one for each room) is ideal.
As well as this, make sure your apartment has a good flow and ask yourself: Is it easy to move from one area to another? Can the communal spaces accommodate the number of guests? Are the bathrooms near the bedrooms? Is there enough space in the bedrooms for the guests plus their belongings?
Put yourself in the shoes of your guests – what would you expect from a high-end rental apartment?
Lastly, if you plan to market the apartment to a reasonably affluent market, ideally, a duplex or a penthouse will be most suitable.
2. Location
It is ideal to find an apartment in a building with as few other properties as possible in order to create a more exclusive atmosphere.
As previously stated, investing in a ski apartment that is close to the ski lifts and the village centre (plus amenities such as shops, bars and restaurants) will greatly heighten its appeal.
3. Facilities
Facilities and equipment are essential to a successful rental property. As we mentioned earlier in the post, apartments are more restricted in regard to private facilities compared with rental chalets.
However, many high-end apartment renovations and new build programmes incorporate these into their plans. Keep an eye out for the following features which can help boost your property’s online presence and attract bookings:
- Secure or off road parking
- Security shutters
- Video or key code door entry systems
- Lifts
- Ski and bike stores
- Secure “caves” (cellars) where owners can keep their own personal belongings
- Private outdoor spaces (balconies and terraces)
- Landscaped gardens
- Fire places/wood burners
- Spa facilities such as hot tubs a saunas
4. Outdoor space
Providing ample outdoor space is a challenge if you don’t own a ground-floor apartment. Though summer guests will often favour properties with gardens, for many winter guests, a balcony is sufficient.
However, there are a few things to consider if you want to make your balcony stand out. And it’s important that you think carefully about these, as for some, the balcony may be one of the main selling factors:
- Safety and local regulations
- Privacy
- Weather conditions
- Storage
- Seating space
- Outdoor dining
- Lighting and deco
To learn more about what makes a perfect balcony for your rental apartment, follow the link below:
5. Lighting and deco
Any holiday rental property needs to exhibit a harmonious style which reflects the owner’s taste without being too personal. What we mean by this is, while it’s a great idea to put a personal stamp on your ski apartment, you need to make sure any guest can walk in and feel as though it is their home for their stay.
For example, we strongly advise against displaying family photos and always recommend you keep clutter/personal items out of the way.
Additionally, when working with smaller spaces, lighting is really important. If you’re able to be involved in the design process, we’d recommend opting for large windows which take advantage of mountain views and flood your apartment with light.
To summarise, a rental apartment in the Alps is a good investment. But the choice between investing in an apartment and a chalet is down to your personal preferences and needs. If you’re at the beginning of your investment, why not speak to one of our property advisers who can help guide you in your decision making? Arrange a 30 minute call today for a free consultation.
Alternatively, browse our properties for sale page to discover what’s currently available on the market. And don’t forget to subscribe to our newsletter and be the first to receive tips on investment, running your holiday rental business, expert opinions and the latest industry news.
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