Our member Wetag Consulting gives us a brief analysis of the situation and evolution of the luxury real estate sector in the Ticino canton. In addition, they talk about the advantages for which clients choose to buy a house or an apartment in this Swiss region to live in.
Buyers who choose the canton of Ticino as a place of residence or for holidays do so for all the benefits that this region offers. A good climate and a lush landscape with gorgeous natural areas such as, the Lake Maggiore and the Lake Lugano, but also other aspects like, the low crime rate, the economic and political stability and, its excellent health system. It also has excellent infrastructures and educational services such as, international schools and universities.
The concept of luxury in the real estate sector
Firstly, luxury is not an absolute term, but relative and evolving, which is perceived differently by everyone, everywhere. For this reason, when we talk about the luxury real estate sector at an international level, the prices vary and kinds of properties too.
For example, a villa situated in the famous Californian city of Beverly Hills, can be valued at 8 million dollars, while in Durban (South Africa) we can acquire one for 750.000 dollars. The position regarding Ticino is intermediate, with prices that start from 3-3.5 million of Swiss Francs.
However, we should also distinguish between the different types of luxury real estate market. There is a primary luxury property market in major cities where people work and reside, such as, New York, Paris and London. There is another called “resort market” that comprises high end properties in touristic and holiday destinations as it could be the Caribbean islands. Finally, a market known as “Jet Set or Life Style” with the most popular places to reside and enjoy holidays. Quinta do Lago in the Portuguese Algarve or Monte Carlo are some examples of the latter. The peculiarity of the canton of Ticino is that, in its different regions, we can find these three markets.
Evolution of the luxury real estate market in the canton of Ticino
As for the evolution of the luxury real estate market in the region of Ticino, there are several factors that are not contributing to the purchasing of properties and the confidence in Switzerland as a safe place for investment. Including policy measures passed in previous years regarding purchasing of properties by international buyers, the strength of the Swiss Franc in relation to other currencies and, the economic uncertainty that countries all round the world are facing. Nevertheless, it is true that there is a gradual return of clients that had abandoned this sector, as is the case of German buyers.
The profile of those investors, who purchase properties in the Ticino canton, and in particular the foreign buyer, stand out for their attention to the real value of the property. These buyers are well informed on the real value of a property. In this way, they avoid over-investing and risk losing profitability when reselling.
As for the future, we believe that it will be important to improve measures that somehow limit the purchase of properties by foreign clients, as well as the tax system. The fact that other countries, with more favorable initiatives for this type of investors, have obtained more positive results cannot be ignored.