Euro Tax Haven Property Prices Climb Again

One of Europe's best kept secrets and hardly known outside of the skiing and financial communities, the small European tax haven of Andorra has seen some startling rises in her property values in the last two years, with a repeat performance in 2007 possible. In 2005 property inflation hit 19 per cent, and in 2006 the official property inflation reached sixteen per cent, and according to Andorra real estate specialists Tribune Properties 2007 is likely to see a further ten per cent rise. 'There are three streams of buyers for Andorra', say Tribune, 'An active local market, second home buyers

looking for ski apartments, and international buyers who want to gain residency in a tax haven. The international buyers add pressure on prices and often buy three or four bedroom apartments and chalets, making sure that the top end of the market is as active as the low and mid range properties.'

With a lack of snow for the first eight weeks of the Andorra ski holiday season, the second home buyers could be thinner on the ground than usual. The number of tourists is down by some fifteen per cent, and that could impact the property market as some visitors like it so much they buy a property in popular resorts such as Arinsal and Soldeu. So we feel a ten per cent rise in Andorra property values could be realistic for 2007.' Andorra as a tax haven destination has been benefitting recently from the high cost of real estate in Monaco. Monaco recently became the most expensive country for property in Europe, and while a 32m2 studio in Monaco will cost close to a million Euros including the closing costs, Andorra offers over 100m2 three bedroom two bathroom apartments at less than half the price - with the same tax advantages as better known Monaco, bringing out a map of Andorra for many investors recently.

The different type of buyers tend to head for different areas of Andorra, with the ski apartment buyers tending to purchase in the key ski resorts of Soldeu and Arinsal. Those looking for residency go more for the year round villages and towns which have a resident community. Outside of the capital (la Vella) these tend to be La Massana and the upcoming village of Anyos, Ordino and Arinsal, although Arinsal's nightlife during the ski season early December to late April tends to steer many newcomers to La Massana and Ordino.