Buying into the heart of Europe

This Alpine country has a lot more to offer investors than just skiing, reports Ben West
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The Independent Online

Until now, few property buyers have considered Austria. A reason for its unpopularity could have been the restrictions on foreign property ownership, yet joining the EU in 1995 saw these laws lifted.

Austria, with a population of only eight million, is by no means crowded and has a stable property market. In the heart of Europe, it contains gorgeous cities, such as Vienna and Salzburg, the latter being the birthplace of Mozart and home of The Sound of Music. Austria's central location means that other fab cities outside the country, like Prague and Venice, are nearby.

"Austria is probably the least exploited Alpine area of Europe," says James Barnes, managing director of Newfound Property International, currently marketing a development for Dutch developer La Perla Living there. "Prices are not particularly low, and comparable to similar properties in France and Switzerland, but a great attraction of Austria is there being very few new developments and, therefore, it is unspoilt, unlike parts of Spain, say."

More than half of the landlocked country is situated within the eastern Alps, offering stunning mountains and a winter sports season that generally extends from December to early April. In the summer, it is a haven for hikers, golfers - there are many outstanding courses - mountain bikers and climbers. The many lakes and rivers are perfect for fly fishing.

Foreign buyers invariably focus upon the ski resorts, but these are also excellent in the summer for outdoor pursuits. Properties in the world-famous resorts like Zell am Zee and Kitzbühel, and the glacier resort of Kaprun, generally require a hefty budget, but prices reduce in such lesser-known towns as Zillertal, Scheffau, Kufstein and Worgl.

"We're seeing a lot more interest from British buyers," says Charlotte Barclay, of agents Austrian Properties. "For a long time, people only thought of Austria for winter skiing, but now they're realising it is ideal for summer too. Although restrictions on buying have been relaxed, in some areas, like St Anton in the Tyrol, few properties come on the open market and when they do they're usually sold to neighbours and friends. Some communities have restrictions preventing certain properties being used as holiday second homes, but these measures apply to everyone. Many Austrians want to avoid the "second-home blight" France has experienced, where foreigners buy a property and then leave it empty for ages."

>Austrian Properties is offering a £640,000, spacious, three-bedroom detached country home in Bad Gastein, with ski lifts, a golf course and thermal spas within easy reach. It features an indoor seawater swimming pool, a sauna, large terraces and balconies, a self-contained apartment and a lift. For those on a smaller budget, it has a £67,000 two-bedroom apartment near the centre of Mittersill, an ideal location for winter sports.

The area south of Salzburg, around the pretty villages of Saafelden and Maria Alm, peppered with ski lifts to the surrounding picture-postcard mountains, is particularly unspoilt and home to one of the country's first holiday- home resorts, La Perla Living's Zum Bären Golf & Ski Resort, which is being constructed. The region, the Hochkönig Winterreich, is an extensive ski area. When the development is completed, 110 high-spec apartments will be contained within 10 large chalets. They are priced from £185,000 for one-bed, £276,000 for two beds and £380,000 for three-bedroom apartments, and there will be a pool and restaurant on site. La Perla Living will manage the rental process and it is expected that the two-bedroom apartments will, on average, enjoy a weekly rental of £1,200 or so. No doubt it will attract the investor seeking an all-year property, with summer golf and winter skiing.

Fact box

Getting there
Austrian Airlines, British Airways and Air Berlin fly to Vienna, while Ryanair, BMIbaby and Flybe have daily flights to Salzburg.

The buying process
A notary system is used for conveyancing. A deposit, usually 10 per cent, is payable and then a purchase agreement is signed. If a property is resold within 10 years, capital gains tax of 34 per cent is payable, and after 10 years of ownership, all property is exempt (if it is the purchaser's primary home, it becomes exempt after five years). Income tax is not payable on small-scale rental proceeds. Local mortgages currently available average a rate of around 4 per cent.

Buying costs
Costs average around 10 to 11 per cent of the purchase price.

Further information
Newfound Property International (020 8605 9520; www.newfoundproperty.com); Austrian Properties (08707 607752; www.austrianproperties.com).

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