Falls Creek and Mount Hotham best for inexpensive ski properties, with prices cooling

The ski season is nearly upon us with the Queen’s birthday long weekend. As thrill-seekers flock to ski resorts in Victoria and NSW, many may be thinking of buying investment property on the slopes.

Property Observer has cleared the frost and found the cheapest properties available right in the ski fields.

And we’ve found Victoria’s Falls Creek and Mount Hotham are the place to look for cheap properties in the ski fields.

A recent REIV report found property prices in the Alpine region had dropped 22.8% in the year to March 2012. This is confirmed by local agent Paul Englisch from Alpine Property Dinner Plain.

“I would suggest it’s more than 22% with the recent sales we’ve had,” says Englisch.

“There’s more currently for sale that there has been in the last 10 years at any one time. And the prices have all gone down.

“It’s impossible it will last though. In Dinner Plain, just down the road, we’ve started selling more than we’re listing. The total number of properties for sale has being reduced by half there.”

Other agents echo this sentiment, with one suggesting prices have dropped by more than 30% over the year.

$44,500

A twin suite in Falls Creek will set you back just $44,500. Rooms 208 and 209 in Silverski Lodge are being sold by RT Edgar Alpine. They each have one bathroom, sleep two people in a bunk bed and share a generous balcony. Agent Christa Zirknitzer says annual outgoings for the property are $3,400. An exact figure for income for the property was unavailable, but Zirknitzer says average income is 2% to 3%. The asking figure is what the vendor paid last year in Morry Schwartz’s mass sell-off.

$79,000

In Mount Hotham, unit 2A in Fountains Apartments is available for $79,000 through PRDnationwide. It comes with a small kitchenette, ensuite and a bunk bed, but there is no gas attached to the apartment. The unit is usually leased as staff accommodation and earns $6000 + GST per season. The unit costs $2,171 in outgoings.

$79,000

For the same price in you can buy apartment five in Mount Hotham’s Jack Frost through RT Edgar. The unit sleeps three people in a three-part bunk bed and includes a decent-sized kitchen, a small entertaining area and a renovated bathroom. The apartment is expected to earn $7,000-$8,000 a year with annual outgoings of $3,200. The similar but renovated neighbouring apartment number four is selling for $105,000, with the same rent and outgoings.

$92,500

In the same lodge, room 207 is up for grabs through the same agent. At $92,500 the room is somewhat bigger and more comfortable but still only sleeps two people in a bunk bed. Again, outgoings are $3,400, and it’s expected to earn a similar income.

$105,000

And for $105,000, apartment 520 in The Arlberg is up for sale through Alpine Property. It sleeps five people, comes with a new bathroom, a sizeable kitchen and ski storage. The property was renovated two years ago at a cost of $20,000 and has not been leased since then. A similar, but unrenovated, apartment in the same building earns $17,000 a year. However the apartment is expected to cost $5,000 a year in head lease charges and another $5,000 on commission, utilities, cleaning and other fees.

RT Edgar Agent Rob Ford recently sold apartment 519 at The Alberg for $95,000. He says the apartment will earn $15,000 a year with outgoings of $6,000.

Ford says The Alberg generates the best returns in Hotham.

“It’s got a very established in-house management company, there’s a lot of return guests. The outgoings generally are very low, and the occupancy levels are very high.”

One thing was clear from speaking to agents in the area. It all depends on the snow.

“Snow equals money. If we have a good season then everyone is happy,” says Paul Englisch.

And given recent snowfalls, this could be a good one.

Photograph of Mount Hotham courtesy of Tourism Victoria.