The Higher the Better: Climate Change and House Prices in Swiss Ski Resorts 2001-2020

The way in which climate change impacts land and property values has drawn considerable attention of economists over the recent years as the impacts of climate change are starting to be felt. Agricultural land and residential property at risk of flooding have received most attention. This paper looks at the case of altitude and (reduced) snowfall and winter sports in the European Alps, a region uniquely dependent on the right climatic conditions for its economic survival. We hypothesise that skiers and house-buyers switch from lower-lying, less snow-secure resorts to high-altitude areas with more reliable snowfall. Employing a panel comprising 303 Swiss municipalities across 45 different ski resorts, our study spans from 2001 to 2020. We regress changes in mean house prices at the municipal level over the 19-year period on altitude, temperature and (change in) snow cover duration. The channels through which climate might affect house prices indirectly (income, employment, visitor numbers) are also examined. We find that higher altitudes and lower temperatures are associated with increased house price appreciation over the 2001-2020 period for ski resorts but not for the control group of municipalities not located near a (major) ski resort. No such relationship is found for average snow cover duration or changes in snow cover. Possible explanations for these findings are discussed.