Tax Breaks and Financial Benefits of Investing in Austrian Ski Resorts

Tax-BreaksThe traditional target for property investment in Austria, Switzerland and Germany has always been student accommodation or buy-to-let residential units. High prices, high management costs and recent tax changes have made this market less attractive, and Austrian investors are showing interest in a different target — ski holiday properties.

In recent years, planning restrictions have created a backlog of building projects in ski resorts, with the result that those which are built attract high demand and strong capital growth. And, at the same time, foreign investment in Austria has never been easier.

So what has happened in Austria to create this boom?

  • Recent governmental changes promise financial stability. In particular, the new finance minister, Hans Jörg Schelling, is likely to favour policies such as tax breaks for investors.
  • The European Central Bank has recently reduced the headline rate of interest, keeping the Euro Libor low.
  • The government is offering a savings loophole with a 1% per annum VAT rebate.
  • A court recently ruled that Austrian property could be bought by an SPV owned by non-EU citizens, which opens up the possibility of a future flight to safety.
  • In the past year, Austrian banks have changed their stance and are showing considerable interest in financing foreign buyers.
  • Austria’s bank secrecy act is stronger than Switzerland’s, giving investors peace of mind.

In spite of this, the price in Val d’Isère, on the other hand, the bottom end of the market for a similar unit would be around €380,000, while most are over €800,000. Switzerland is even more expensive, with few 2-bedroom apartments in Zermatt below €500,000, and Davos even more expensive. Prices of Austrian ski properties are still remarkably low. A 2-bedroom apartment in Sölden, for instance, can currently be bought for as little as €334,995, and similar apartments in Ischgl go as low as €323,400. This rises to only a little over €600,000 for penthouse apartments.

Austrian resorts can match or exceed these for quality, and investors have a unique opportunity to snap up valuable property at such low prices. It won’t be long before everyone else wakes up to this and the prices rise, offering a substantial return on your investment.

European Central Bank reduces rate of interest making Austrian property investment all the more attractive

In an effort to keep low inflation from derailing the Eurozone’s economy, the European Central Bank has surprised financial markets this September with a cut in interest rates and new stimulus plans.

Speaking at a press conference after the announcement of the rate cut, ECB president Mario Draghi said the Bank expected to see “a prolonged period of low inflation” and reiterated a pledge to keep rates low for the foreseeable future.  After the rate cut was announced, the Euro fell against the Dollar and Sterling making a purchase of property in Europe even more attractive.

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The European Central Bank cut interest rates and announced a program to pump money into the economy and stimulate lending by buying bundles of bank loans.

It may not be a coincidence that we have seen a change in stance in the last 12 months by Austrian banks which have shown a high interest in financing up to 60% of the purchase price of ski property investments by foreign buyers.

If a potential investor is shrewd, they could secure a property now with Kristall Spaces at Spring 2014 prices with only a 1% fully-refundable reservation fee (no buyer’s commission fee) with the first 15% stage payment not due before the spring of 2015.

Furthermore, we have seen an apartment bought for €300k in our recently completed project in Zell am See be remarketed for €350k within 12 months and the buyer only paid 60% of the price before making the decision to sell.

That equates to a €50k uplift on a €180k capital investment in just 12 months.

Please get in contact with us today and find out how you could earn up to 15% IRR on one of our Austrian ski properties.

Five Unmissable Events in Austria This Winter

FIS Ski World Cup Opening

From the 24th to the 26th October, the Rettenbach Glacier above the resort of Sölden hosts the opening event of the FSI Ski World Cup, the Giant Slalom. Featuring the world’s top skiers, including reigning world champion Ted Ligety, the runs will be held in the Rettenbach’s state-of-the-art stadium. In between, there’ll be a full programme of processions, presentations and parties for everyone, both on the glacier and down in Sölden.

FIS Alpine Ski World Cup Opening, 25. - 26.10.2014, RETTENBACH GLACIER.

Top of the Mountain Opening Concert with James Blunt

On Saturday 29th November, the annual Top of the Mountain opening concert welcomes singer-songwriter James Blunt. The free gigs marking the start and finish of the season at Ischgl have traditionally attracted stars such as Elton John, Robbie Williams and Mariah Carey, to be enjoyed by the winter sports enthusiasts who flock to the resort. This year Blunt, who is himself an enthusiastic skier, is including the date in his Moon Landing tour.

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International Hot Air Balloon Week

The “balloon village” of Filzmoos, in the shadow of the mighty mountain Bischofsmütze, is hosting the 36th International BP-Gas Balloon Trophy from the 10th to the 17th January. About forty balloon teams from all over the world will be taking part, flying over the high ranges and picturesque valleys of the district. In addition to the more formal races, the Sunday features a musical display of glowing, colourful balloons, while Wednesday is dedicated to the children.

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Valartis Bank Snow Polo World Cup

The 15th to the 18th January sees snow polo come to Kitzbühel for the 13th Valartis Bank Snow Polo World Cup. A modern variant of polo, this is an exciting, skilful game played across level, compacted snow, and its premier event sees top players and high society gather in the Tyrol in January. Matches are played on the Münichauer Wieser, with the striking Kitzbühler Horn in the background.

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International Hahnenkamm Race

From the 21st to the 25th January, Kitzbühel in Tyrol hosts the Hahnenkamm Race, a series of skiing races held since 1931 and for decades forming part of the World Cup. The event consists of the Super-G, the Slalom, and the Downhill on the Streif, widely considered the most demanding course on the World Cup circuit, including the 80m Mausefalle (mousetrap) jump near the top. The event will feature breathtaking speed and skills from the world’s top skiers.

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Mitterlehner has taken leadership of Austria’s OVP and Hans Jörg Schelling has become the finance minister, but what does this mean for real estate investment in Austria?

MitterlehnerIn the past few days, there’s been a major shake-up in Austria’s ruling coalition between the conservative OVP and the Social Democrats. The OVP’s leader and Finance Minister, Michael Spindelegger, resigned on the 26th August and was replaced at once as party leader by Reinhold Mitterlehner. On 1st September, Hans Jörg Schelling was announced as the new Finance Minister.

Spindelegger had been at loggerheads with both the Social Democrats and much of his own party over his fiscal inflexibility and his opposition to tax cuts. Schelling, however, has extensive experience in business, ranging from furniture to banking, as well as having served as chairman of public service organisations. He’s an excellent negotiator, and can be expected to show far more sympathy than his predecessor to cuts in Austria’s dangerously high tax level.

So what can Austria hope for from this change? For a start, by healing the OVP’s internal divisions, it should make them a stronger force within the coalition. Turning away from Spindelegger’s fiscal dogmatism will mean the government’s financial policy can be more business friendly. Schelling is highly likely to introduce a stimulus package that includes a reduction in income tax.

Dr Hans Joerg SchellingThis can only be good for investment, with both Austrian and foreign investors far more confident about taking risks. A stable economy creates the ideal environment for property investment, in particular. The kind of reforms the country can look forward to with Schelling in charge of finance will both encourage investment and will mean the average Austrian has a higher disposable income.

Inevitably, there’s going to be a rush to invest in holiday property in the mountains. Even during the recession this has been a good deal, but greater confidence in the economy will increase demand. Anyone with the resolve to get in before this will do very well.

The prospects for the Austrian economy look excellent for the coming years, and a strong Austrian economy can only be good for owners of holiday real estate. There’ll rarely be a better time to invest.

Ischgl Overmountain Challenge – from Friday 12 to Sunday 14 September 2014

Watch and even mingle with Europe’s best endurance racers, who will be demonstrating their skills, strength, tenacity and courage at the second Ischgl Overmountain Challenge. It’s running from Friday 12 to Sunday 14 September 2014 at the Silvretta Bike Arena, which is between Ischgl and Swiss Samnaun High Country Valley.

Ischgl Overmountain Challenge

The Ischgl Overmountain Challenge will take place against a backdrop of inspiring Alpine scenery and infinite, breathtaking trails.  Enjoy yourself with old friends or make new ones while you watch some of the best in their field compete against each other – stars such as Jérome Clementz, 2013’s champion and the winner of the 2013 Enduro World Series, and Nico Lau, both of whom have already confirmed their attendance and participation.

If you want to get involved, the competition section is simple and designed to be fun!  Your time will be recorded over certain sections of the trail, so you can cycle at your own pace. Naturally, you will want to go as fast as you can – but do take a moment to appreciate the beauty and freshness of the Silvretta Alps.  Finally, the times from the various sections are added together and the competitor with the best overall time will be named the winner.

Prefer not to cycle to the top? You and your bike can take the cable car up instead, then you can take in the spectacular views and cycle back down.

Do you expect to take public transport to the event? You can now plan your journey in advance.

Ischgl Overmountain Challenge

Ischgl Overmountain Challenge

Ischgl Overmountain Challenge

FIS Alpine Ski World Cup Opening 25 – 26.10.2014 Rettenbach Glacier

FIS Alpine Ski World Cup Opening, 25. - 26.10.2014, RETTENBACH GLACIER.
As we head out of summer, the skiing season is drawing nearer.  The beautiful Austrian resort of Sölden is hosting major alpine sports events all winter, but the most important is the FIS Alpine Ski World Cup on the Rettenbach Glacier, held on the weekend of the 25th and 26th October.

Featuring the most widely followed event of the Alpine Skiing programme, the Giant Slalom, the event will attract the world’s top skiers, such as reigning and multiple men’s champion Ted Ligety.

The stadium itself is a state-of-the-art venue, with seating for 1500 and many more standing places. It has full sanitary facilities, as well as accommodation for press and broadcasters. There’s no public parking at the stadium — parking is restricted to permit-holders on World Cup business — but parking is available at:

• Giggijoch (1000 cars in total)
• Gaislachkogl (980 cars and 18 buses in total)
• Tiefenbach Glacier (1100 cars and 40 buses in total)

All these locations offer a park-and-ride facility, with a shuttle bus to the stadium. Use of the bus is included in your entrance ticket, and it additionally calls at:

• Hotel Stefan
• Liebe Sonne
• Postplatz
• Sparkasse
• BP petrol station
• Pitze
• The turn-off to Innerwald

Admission is as little as €30.00 for the weekend if you stand, with reduced prices for young people and children under eight admitted free. If you prefer to watch from the comfort of a seat, that costs €45.00 per day for all ages.

The World Cup programme 2014

Friday 24/10/2014

13.00-16.00 FIS FORUM ALPINUM – Freizeit Arena Sölden
18.30 Women’s bib number drawing – Postplatz Square, Sölden centre
KRONE World Cup Party

Saturday 25/10/2014

9.30 1st run Women’s GSL – Rettenbach Glacier
12.45 2nd run Women’s GSL – Rettenbach Glacier
Flower Ceremony Women’s GSL – Rettenbach Glacier
O3 Party – Rettenbach Glacier
17.00 Parade of Fan Clubs – Sölden village centre
18.30 Official prize-giving ceremony – Women’s GSL – Postplatz Square, Sölden centre
18.45 Men’s bib number drawing – Postplatz Square – Sölden centre
KRONE World Cup Party
19.00 Race Party

Sunday 26/10/2014

9.30 1st run Men’s GSL – Rettenbach Glacier
12.45 2nd run Men’s GSL – Rettenbach Glacier
Flower and prize-giving ceremony – Rettenbach Glacier
O3 Party Glacier Party – Rettenbach Glacier
Awarding of the best Fan Clubs

All the local hotels are bound to fill up quickly, so make sure you get a booking in early and don’t miss out on the event of the season for Alpine Skiing.

Investing in Austria with Arnold Schwarzenegger

In a recent TV commercial for an Australian real estate company, Arnold Schwarzenegger showed he is less than savvy with navigating the web when he found himself looking on a Australian company’s website for a property in Austria.

You don’t want to be like Arnie — at least not with your online real estate search.  If you’re looking for an Austrian property to invest in with strong capital growth and a management company that manages the rental for you, then come to the experts:  Kristall Spaces.

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Kristall Spaces develops and sells more ski property in Austria than any other company.  Our team knows the Austrian Alps better than anybody else – we’ve been welcoming holidaymakers and owners to the Tirol for generations so your property search and investment needs are in safe hands with us.

Furthermore, we arrange the maintenance and marketing for you so it’s a hassle-free investment.

Browse from a wide selection of ski chalets and apartments for sale in SaalbachZell am See, Kühtai, Ischgl and St Anton … more locations to be announced soon.

Download our brochure today and find out how we can help you find the ideal Austrian property today, far away from the outback.

Benefits of investing in Kühtai real estate

Located high in the Tyrol, Kühtai boasts an elevation of 2,020 metres, making it a prime destination for winter and extreme sports of all varieties.

The population of this small Tirolean village is only a few dozen residents during the off-season, however, during the holiday period, its numbers swell exponentially as those in the know seek the best early and late season skiing.

Investing in Kühtai

A common concern often voiced when investing in a ski resort such as Kühtai from afar is the logistics that such an investment can entail.

With about 65 million visitors travelling to Austria each winter, there is strong demand for locations like Kühtai, especially with its proximity to Innsbrück  airport (35 minutes), ski and ski out accommodation and high altitude summer training camp, fuelling high occupancy rates throughout the year.

SILVRETTA RUN 3000 – 15:00 on Friday 18 July 2014

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SILVRETTARUN 3000You can run up and down European marathons in Paris, Rome, and Stockholm but never see the beautiful sights on display each year during the Silvretta Run 3000. This cross-country tour takes runners up into the hills of Paznaun, where they can choose three different routes: easy, medium, and hard. For a thirty two Euro entry fee, five Euro of which goes to support the spinal cord Wings for Life charity, runners can speed their way through (or take a leisurely run) through the 3000-meter peaks and valleys of the Austrian Alps. The race begins at 15:00 on Friday 18 July and concludes at approximately 17:00 of Saturday 19 July at the Galtür Sports Centre.

The easiest route rises only about three hundred meters from the starting point to the highest point and is an excellent way to get accustomed to mountain running. The longer races, however, stretch out over the course of a half or full marathon (28 and 43 kilometers, respectively) and challenge all runners to perform at their physical peak for the duration. Each finisher receives a gift as well as food and water along the race, luggage transport to the start, and shower facilities at the conclusion of the marathon.

silvrettarun-3000-tirolRegistration takes place at the Paznaun-Ischgl tourist authority. Anyone who wants to watch the race without actually running up and down the mountains can take in the beginning at the namesake Silvretta Square in Ischgl; anyone willing to follow the runners up and down the Alps by following the trail through the Fimbatal Valley. Those who find the race challenging enough for their tastes can come back in the later months for the Ironbike 2014, which takes them through more hills in the Austrian Alps on the seat of a mountain bike.

Those staying in Ischgl for the marathons or mini-marathons can find accommodation at four-star hotels like the Hotel Marangun.

Number of Tourists Entering Austria in Winter and Summer

397A record number of tourists are entering Austria in winter and summer now. Austria has become one of the most popular travel destinations of late, because of its wonderful climate and its ample entertainment opportunities, that include outdoor activities, classical music, art and architecture.

In fact, Austria’s tourism numbers have been steadily increasing during the past 50 years and today tourism makes up more than 8% of Austria’s annual GDP. It is becoming one of the most important and fastest growing sectors of the Austrian economy.

Today, investments in the leisure sector, including investment properties, are at record levels. An investment in vacation rentals is seen as a sophisticated and sustainable prospect, with year-round range and international appeal. This includes vacation rental opportunities with Kristall Spaces properties in Austria’s top ski resorts. Skiing is one of Austria’s main draws, but there is much to do at these resorts in addition to skiing, so they appeal to every visitor.

Tourism by the Numbers

wp517eb0ed_05_06Today, Europe is the most visited area in the world. In Austria, the winter season sees a 50% share of tourists, which means that half of all the 125 million annual overnight stays occur during the winter, or skiing season. The other half of tourists visit in the gorgeous summer months, to take in the gorgeous scenery, hike, sightsee and take in the cultural attractions.

In 2006, Austria was ninth in the world in terms of international tourist arrivals, with 72% of foreigners making overnight stays. Austria’s tourist travel is predicted to rise by 1.5% each year for the next 15 years, and then by 1% after that, for the next 15 years. An investment in Austria’s tourism looks to be a smart, and lucrative, idea.

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