Having spent tens of millions of Euros on new and improved facilities for skiiers, European country Andorra was looking forward to a good 2007 season, increasing the near ten million tourists that have been visiting in previous years.

But the one thing the country really needs to entice ski tourists hasn’t been coming – snow.

Over the last decade Andorra has been blessed with an abundance of snow, making for perfect ski conditions. But while the snow has started falling as early as the last week of October in previous years, none has fallen so far for the 2007 ski holiday season.

‘The snow making machines have been working overtime since the beginning of the season’, comment a local travel guide, continued ‘They have allowed a depth of around 20cm of snow for popular Andorra ski resorts like Soldeu, but while it’s an effective substitute for many skiiers it’s still not the real thing. It’s allowing skiing for people who booked their holidays a while ago, but last minute bookings are well down as people read the ski reports and head elsewhere this year.’

Press reports in the UK, Andorra’s top market, have indicated that some tour operators have already cut their prices, some by nearly 50 per cent, to entice the skiiers back to the Principality.

‘It really is the market for later in the season that’s in danger of being hit’, say the guide, ‘If they see now there isn’t much snow in Andorra this will influence their booking even though it could be a different story altogether when they get to go on their ski holiday’.

The ski tourist is also an important factor for the real estate agents in Andorra, with a percentage wanting to buy a holiday home after a visit.

‘So far there has been little change in the demand’, claim an Andorra property company who specialise in Andorra property for sale, ‘A lot of the buyers at the moment are those who visited last year, but it might have some impact from mid October onwards 2007′.

Andorra Real Estate

Buying a property in Andorra is often seen as a route to residency, which entitles people to live in Andorra and benefit from her tax haven status.

To obtain residency in Andorra, applications need to be submitted in Catalan. A notarised copy of the applicants passport, birth certificate and a certificate of good conduct from the home country are submitted at the same time. Residency normally takes between three and six months to be approved.

Once residency is granted, residents are supposed to spend six months a year in Andorra, but this isn’t policed.

One of the drawbacks for those looking to become a resident in a tax haven when considering Andorra has been that the country has no airport of its own, and is unlikely to have ine future given that it is located in the Pyrenees. The nearest airports are Barcelona and Toulouse.

Recent improvements in the road from Barcelona to Andorra though have cut the travelling time by some thirty minutes to two hours fifteen minutes.

After spending tens of millions of Euros on new and improved facilities for skiers, European country Andorra was looking forward to a good 2007 season, increasing the near ten million tourists that have been visiting in previous years.

But the one thing the country really needs to entice ski tourists hasn’t been coming – snow.

Over the last decade Andorra has been blessed with an abundance of snow, making for perfect ski conditions. But while the snow has started falling as early as the last week of October in previous years, none has fallen so far for the 2007 ski holiday season.

‘The snow making machines have been working overtime since the beginning of the season’, comment a local travel guide, continuing ‘They have allowed a depth of around 20cm of snow for popular Andorra ski resorts like Soldeu, but while it’s an effective substitute for many skiiers it’s still not the real thing. It’s allowing skiing for people who booked their holidays a while ago, but last minute bookings are well down as people read the ski reports and head elsewhere this year.’

Press reports in the UK, Andorra’s top market, have indicated that some tour operators have already cut their prices, some by nearly 50 per cent, to entice the skiiers back to the Principality.

‘It really is the market for later in the season that’s in danger of being hit’, say the guide, ‘If they see now there isn’t much snow in Andorra this will influence their booking even though it could be a different story altogether when they get to go on their ski holiday’.

The ski tourist is also an important factor for the real estate agents in Andorra, with a percentage wanting to buy a holiday home after a visit.

‘So far there has been little change in the demand’, claim an Andorra property company who specialise in Andorra property for sale at ‘A lot of the buyers at the moment are those who visited last year, but it might have some impact from mid October onwards 2007′.

Andorra Property

Buying a property in Andorra is often seen as a route to residency, which entitles people to live in Andorra and benefit from her tax haven status.

To obtain residency in Andorra, applications need to be submitted in Catalan. A notarised copy of the applicants passport, birth certificate and a certificate of good conduct from the home country are submitted at the same time. Residency normally takes between three and six months to be approved.

Once residency is granted, residents are supposed to spend six months a year in Andorra, but this isn’t policed.

One of the drawbacks for those looking to become a resident in a tax haven when considering Andorra has been that the country has no airport of its own, and is unlikely to have ine future given that it is located in the Pyrenees. The nearest airports are Barcelona and Toulouse.

Recent improvements in the road from Barcelona to Andorra though have cut the travelling time by some thirty minutes to two hours fifteen minutes.

‘Given the tax advantages Andorra has’, note the travel guide, ‘A two and a quarter hour trip to the nearest international airport could be viewed as a small price to pay for those who will be saving substantial amounts of money in tax. Especially when you consider that their properties could be rising in value quite significantly in the years to come, and for those who like skiing it’s a holiday and tax paradise in one!’

Once a poor European country with no real economy, Andorra has been transformed in the past forty years to a vibrant independent State, sought after by the wealthy for her tax haven status, and skiers for her ski runs that match the best in Europe for facilities and ski holidays infrastructure.

The one drawback that Andorra has had is the distance from a major airport, two and a half hours drive to Barcelona in Spain or Toulouse in France, with some ski holidays starting with a night in one of the hotels in Barcelona before setting off for Andorra.

But that is set to change with agreement for an aiport to be built just fifteen minutes drive from the Spanish / Andorra border.

As well as the extra ski tourists the new airport will impact Andorra as a tax haven. Andorra and the more famous Monaco are Europe’s leading tax havens, with residents enjoying the benefit of no income tax. Property prices in Andorra are less than a third of the price of Monaco’s.

Commenting on the new airport, Andorra estate agents who specialise in Andorra property for sale thinks that the prices of Andorra properties will rise.

‘At the moment Monaco has the advantage of being ten minutes away from an international airport by helicopter, while Andorra is over two hours. With that advantage gone we anticipate more people considering a tax haven will consider Andorra, with a resulting appreciation in property prices.’

Property in Andorra has risen an average of ten per cent a year in recent years, with three streams of buyers – the local market, buyers for ski holiday homes who are often on a Crystal Ski holiday and like Andorra enough to buy a holiday home, plus those looking for a tax haven.

The airport is to be located in Seu d’Urgell, and the first flights are anticipated to be in 2010 or 2011, with a runway of 4,500 feet – not long enough for some medium range aircraft, and it is likely that most commercial airlines using the airport will be 60 to 80 seaters, plus private jets much favoured by the wealthy who might now consider Andorra as a viable tax haven.

As well as being welcomed by the property business in Andorra, a new airport has been greeted enthusiastically by the skiing industry.

The country has upgraded facilities in recent years, and often competes as a top ski destination in Europe, with well known ski companies like Crystal ski operating holidays for the British market.

In recent years the number of tourists for the Andorra ski holiday season has topped ten million visitors, and the ski industry is an important part of the country’s economy, with the government investing in new infrastructure to help tempt visitors back for skiing for repeat visits.

But last year was the worst season for decades as the snow, which normally falls from end October, didn’t arrive until mid March, and the first drop in the number of ski holidays in Andorra being sold by British and other European travel agents dropped from the previous ski season for some years.

The new airport cutting travelling time from the UK, one of the Andorra ski holiday’s main markets, could boost the occupancy levels of Andorra hotels significantly.

‘When people are considering a ski holiday in Andorra’, comment one travel guide, ‘At the moment to reach Soldeu, one of Andorra top ski villages, it’s two and a half hours from Barcelona to the capital la Vella, and then another twenty minutes on top of that – nearly a three hour trip after a flight. Cutting down resort arrival time from three to one hour will be enough to influence some people’s decision on where to visit.’

Recent investment by the government has reached several million Euros designed to keep the country in line with other European winter destinations, and intended to make Andorra a natural choice for the ski and snowboard fraternity, the addition of an airport close to her border could help ensure that.

All that is needed now is a good level of snow in the years to come.

Tax haven Andorra’s government has introduced Capital Gains Tax in a move that has surprised many in the tax industry.

Andorra is a well known European tax haven, and residents benefit from a zero rated income tax and inheritance tax.

The reason for the introduction of the capital gains tax according to the Andorra authorities is to try to slow down the high property inflation seen in the principality in recent years.

Property prices have risen an average of ten per cent over the last decade, but this has been increasing recently with a 19 per cent rise recorded in 2005, and 16 per cent in 2006, leading to worries that locals might be priced out of the market.

As well as the local market, Andorra property sells to second home buyers and international buyers wanting residency. With property prices a quarter of rival tax haven Monaco, demand has increased from international buyers.

But any hope of the new capital gains tax dampening property prices is unlikely to work, according to Andorra property specialists.

‘While there is a large disparity between Europe’s top two tax havens – Monaco and Andorra – in property prices, the advantages of buying a property in Andorra, gaining residency and having no income tax far outweighs any capital gains taxes’, they say, pointing out that Andorra prices are a quarter of those of Monaco’s.

‘Besides the increase in property prices that offset any Capital Gains Tax’, they continue, ‘It’s on a sliding scale, with one per cent reduced for each year of residency. So for example if someone maintains residency for ten years, the capital gains tax will be five per cent of the property price increase. If someone stays a resident for fifteen years there will be no capital gains tax at all to pay on the increase of their property value.’

Buying a property in Andorra is often seen as a route to residency, which entitles people to live in Andorra and benefit from her tax haven status.

To obtain residency in Andorra, applications need to be submitted in Catalan. A notarised copy of the applicants passport, birth certificate and a certificate of good conduct from the home country are submitted at the same time. According to an Andorra travel guide residency normally takes between three and six months to be approved.

Once residency is granted, residents are supposed to spend six months a year in Andorra, but this isn’t policed.

One of the drawbacks for those looking to become a resident in a tax haven when considering Andorra has been that the country has no airport of its own, and is unlikely to have in the future given that it is located in the Pyrenees. The nearest airports are Barcelona and Toulouse.

Recent improvements in the road from Barcelona to Andorra though have cut the travelling time by some thirty minutes to two hours fifteen minutes.

‘Given the tax advantages Andorra has’, note the guide, ‘A two and a quarter hour trip to the nearest international airport could be viewed as a small price to pay for those who will be saving substantial amounts of money in tax. Especially when you consider that their properties could be rising in value quite significantly in the years to come, and for those who like skiing it’s a holiday and tax paradise in one!’

Andorra has been transformed in the past forty years to a vibrant independent State, sought after by the wealthy for her tax haven status, and skiers for her ski runs that match the best in Europe for facilities and ski holidays infrastructure.

The one drawback that Andorra has had is the distance from a major airport, two and a half hours drive to Barcelona in Spain or Toulouse in France, with some ski holidays starting with a night in one of Barcelona hotels before setting off for Andorra.

But that is set to change with agreement for an aiport to be built just fifteen minutes drive from the Spanish / Andorra border.

As well as the extra ski tourists the new airport will impact Andorra as a tax haven. Andorra and the more famous Monaco are Europe’s leading tax havens, with residents enjoying the benefit of no income tax. Property prices in Andorra are less than a third of the price of Monaco’s.

Commenting on the new airport, one Andorra estate agent who specialises in Andorra property for sale thinks that the prices of Andorra properties will rise.

‘At the moment Monaco has the advantage of being ten minutes away from an international airport by helicopter, while Andorra is over two hours. With that advantage gone we anticipate more people considering a tax haven will consider Andorra, with a resulting appreciation in property prices.’

Property in Andorra has risen an average of ten per cent a year in recent years, with three streams of buyers – the local market, buyers for ski holiday homes who are often on a Crystal Ski holiday and like Andorra enough to buy a holiday home, plus those looking for a tax haven.

The airport is to be located in Seu d’Urgell, and the first flights are anticipated to be in 2010 or 2011, with a runway of 4,500 feet – not long enough for some medium range aircraft, and it is likely that most commercial airlines using the airport will be 60 to 80 seaters, plus private jets much favoured by the wealthy who might now consider Andorra as a viable tax haven.

As well as being welcomed by the property business in Andorra, a new airport has been greeted enthusiastically by the skiing industry.

The country has upgraded facilities in recent years, and often competes as a top ski destination in Europe, with well known ski companies like Crystal Ski operating holidays for the British market.

In recent years the number of tourists for the Andorra ski holiday season has topped ten million visitors, and the ski industry is an important part of the country’s economy, with the government investing in new infrastructure to help tempt visitors back for skiing for repeat visits.

But last year was the worst season for decades as the snow, which normally falls from end October, didn’t arrive until mid March, and the first drop in the number of ski holidays in Andorra being sold by British and other European travel agents dropped from the previous ski season for some years.

The new airport cutting travelling time from the UK, one of the Andorra ski holiday’s main markets, could boost the occupancy levels of hotels in Andorra significantly.

‘When people are considering a ski holiday in Andorra’, comment one travel guide, ‘At the moment to reach Soldeu, one of Andorra top ski villages, it’s two and a half hours from Barcelona to the capital la Vella, and then another twenty minutes on top of that – nearly a three hour trip after a flight. Cutting down resort arrival time from three to one hour will be enough to influence some people’s decision on where to visit.’

Recent investment by the government has reached several million Euros designed to keep the country in line with other European winter destinations, and intended to make Andorra a natural choice for the ski and snowboard fraternity, the addition of an airport close to her border could help ensure that.

The Andorra government has introduced Capital Gains Tax in a move that has surprised many in the tax industry.

Andorra is a well known European tax haven, and residents benefit from a zero rated income tax and inheritance tax.

The reason for the introduction of the capital gains tax according to the Andorra authorities is to try to slow down the high property inflation seen in the principality in recent years.

Property prices have risen an average of ten per cent over the last decade, but this has been increasing recently with a 19 per cent rise recorded in 2005, and 16 per cent in 2006, leading to worries that locals might be priced out of the market.

As well as the local market, Andorra property sells to second home buyers and international buyers wanting residency. With property prices a quarter of rival tax haven Monaco, demand has increased from international buyers.

But any hope of the new capital gains tax dampening property prices is unlikely to work, according to Andorra property companies.

‘While there is a large disparity between Europe’s top two tax havens – Monaco and Andorra – in property prices, the advantages of buying a property in Andorra, gaining residency and having no income tax far outweighs any capital gains taxes’, they say, pointing out that Andorra prices are a quarter of those of Monaco’s.

Long Term Benefit

‘Besides the increase in property prices that offset any Capital Gains Tax’, they continue, ‘It’s on a sliding scale, with one per cent reduced for each year of residency. So for example if someone maintains residency for ten years, the capital gains tax will be five per cent of the property price increase. If someone stays a resident for fifteen years there will be no capital gains tax at all to pay on the increase of their property value.’

Buying a property in Andorra is often seen as a route to residency, which entitles people to live in Andorra and benefit from her tax haven status.

To obtain residency in Andorra, applications need to be submitted in Catalan. A notarised copy of the applicants passport, birth certificate and a certificate of good conduct from the home country are submitted at the same time. According to a local travel guide residency normally takes between three and six months to be approved.

Once residency is granted, residents are supposed to spend six months a year in Andorra, but this isn’t policed.

One of the drawbacks for those looking to become a resident in a tax haven when considering Andorra has been that the country has no airport of its own, and is unlikely to have ine future given that it is located in the Pyrenees. The nearest airports are Barcelona and Toulouse.

Recent improvements in the road from Barcelona to Andorra though have cut the travelling time by some thirty minutes to two hours fifteen minutes.

‘Given the tax advantages Andorra has’, note the travel guide, ‘A two and a quarter hour trip to the nearest international airport could be viewed as a small price to pay for those who will be saving substantial amounts of money in tax. Especially when you consider that their properties could be rising in value quite significantly in the years to come, and for those who like skiing it’s a holiday and tax paradise in one!’

Dire warnings have been coming thick and fast from the world’s finance community that property prices in the West are likely to fall heavily in 2008 and through to 2009.

But the tax haven of Andorra goes against economic reasoning and could see a rise in value this year – over the inflation rate – just as it has done over the last five years.

There are good reasons why demand for Andorra property – and a further rise in value – is likely to happen.

The top reason is that Andorra is a tax haven, and the wealthy buy property to gain residency in Andorra for her tax haven status.

Even in times of recession Andorra is popular as the wealthy want to preserve their wealth, and having Andorra residency means their capital is free of many of the taxes they would have to pay in their homeland.

Andorra is also known for her ski holidays, competing directly with French ski holidays, and Andorra apartments are often bought by skiers for a holiday home, and rented out for income while not skiing themselves.

A third stream of buyers come from the local market, Andorra has some 80,000 people living in the country full time, with many people upgrading or downsizing, meaning Andorra has three streams of property buyers – the local market, those buying for her tax haven status, and holiday home buyers for the skiing.

                                                  Andorra Ski

Last year saw a slowing down of the world’s economy, and property markets shortly after the economic downturn news slowed down too.

Andorra achieved a near 5 per cent increase in her property values in 2007, and some potential buyers considering residency are assuming that real estate in Andorra could see a fall in value in the year ahead, as other markets start to fall.

But according to Tribune Properties, who specialise in Andorra real estate, they could well be wrong in their assumptions.

They report that based on the first half of 2008, the full year will be similar to 2007, with a near 5 per cent rise in property values. But they have noticed some difference in the last twelve months in what buyers expect, and the amount of money people are spending.

‘Over the last twelve months the average purchase price of an Andorra property has risen surprisingly,’ they say, adding ‘Two years ago the majority of our sales were for apartments around the 300,000 Euro level. Now we’re selling as many properties in the half a million to million Euro bracket as we are at the 300,000 Euro level.’

Part of the increase in value of the typical Andorra property now being sold is due to the better known European tax haven of Monaco, where there is a shortage of property, and real estate ranks among the highest in the world. It’s now rare to find even a studio apartment in Monaco under a million Euros – and for the same money and tax benefits that would buy a good house in Andorra.

‘It used to be said that you could see property buyers filling the lounges of Monaco’s hotels – it’s now the hotels in Andorra where the buyers are’, claim the property company.

With a new airport set to open in two years time, Andorra could see property prices rise further in the years ahead.

Little 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 property 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 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.

Thomson Ski

In addition to attracting international buyers in increasing numbers for residency, the Andorra authorities have invested heavily in their ski infrastructure, boosting the country’s tourism potential and subsequently Andorra’s real estate market.

And for this year’s ski season Andorra has opened a new family friendly ski park in Arinsal, moving away further still from her old image of a cheap and cheerful ski holiday for 18-30 year olds to one that caters well for all.

One of the few drawbacks when taking residency in Andorra compared to Monaco has been access to a major international airport. While Monaco enjoys close proximity to Nice Airport, with a ten minute helicopter ride available, Andorra’s nearest airports have been Barcelona and Toulouse, three hours away, with no direct flights to Andorra.

Recent road improvements between Barcelona and Andorra has cut this by thirty minutes, and there is a possibility of a scheduled helicopter service, Andorra weather permitting, or more likely ten minutes from the Spanish Andorra border, allowing quicker access to international flights for business people considering Andorra residency.

Other improvements within Andorra include new tunnels, allowing quicker access to the ski fields, and driving around Andorra easier.

With more demand from international buyers who want to take advantage of Andorra residency, the Andorra government announced in February that it was increasing the number of residency applications from the previous 200 year a year to 500.

‘Andorra is becoming more popular among the international buyers’, comment local travel guide YourAndorra, ‘And with Monaco real estate prices sky high it comes as no surprise that the government has moved favourably by allowing more residents. But it’s not just the tax free living they come for – it’s the Andorra weather as well for many who see the ideal opportunity to live in a tax free environment and enjoying winter sports too.’

Andorra, the tiny independent country in the Pyrenees, saw her property prices rise in value by 19.3 per cent last year, and a local travel guide suggests that another rise in prices is likely in the year ahead.

Best known for her ski resorts, Andorra attracts nearly ten million tourists a year, but it’s not just the holiday makers who are falling in love with the country and buying second homes that is fuelling the price rises, the guide says.

‘Quite a few tourists do like Andorra enough to buy a ski apartment, and there is an active local market too. But what really pushes the prices up is that there’s a third stream of buyers, people from around the world who want to take residency and benefit from Andorra’s tax haven status.’

Property currently for sale in Andorra include one bedroom apartments at 210,000 Euros, two bedroom apartments in Soldeu, the main skiing area of Andorra, at 272,000 Euros and 280,000 Euros in another ski village Arinsal, and three bedroom apartments in the capital Andorra la Vella at 333,000 Euros. Houses start from around 900,000 Euros.

Andorra property specialists have also noticed an increase in buyers recently, and comment that a large part of the increase in buyers is the increased attention from potential overseas property buyers in the UK.

‘The number of buyers from the UK has increased quite noticeably over the last couple of years’, they say, ‘With many quoting higher taxes in the UK as their reason for moving to Andorra. Most seemed convinced that the tax take from their earnings will rise more in the years ahead, and are planning for retirement and selling their businesses now’.

The companies also comment that historically tax havens have been popular no matter how the economy is. When someone buys a property in Monaco it often doesn’t matter to them if it’s a few hundred thousand Euros as they’re going to save more than that in tax during the time they are resident in Andorra.

More Property Price Increases

Demand for property in Andorra for the year ahead is every bit as high as in the past, with many potential buyers already having planned visits.

Surprisingly perhaps for a tax haven, mortgages for a property are as available as many European countries, with rates around the same level. Up to eighty per cent of a property’s value is often agreed by the banks in Andorra.

Buying a property in Andorra is often seen as a route to residency, which entitles people to live in Andorra and benefit from her tax haven status.

To obtain residency in Andorra, applications need to be submitted in Catalan. A notarised copy of the applicants passport, birth certificate and a certificate of good conduct from the home country are submitted at the same time. Residency normally takes between three and six months to be approved.

Once residency is granted, residents are supposed to spend six months a year in Andorra, but this isn’t policed.

One of the drawbacks for those looking to become a resident in a tax haven when considering Andorra has been that the country has no airport of its own, and is unlikely to have ine future given that it is located in the Pyrenees. The nearest airports are Barcelona and Toulouse.

Recent improvements in the road from Barcelona to Andorra though have cut the travelling time by some thirty minutes to two hours fifteen minutes.

‘Given the tax advantages Andorra has’, note a travel guide, ‘A two and a quarter hour trip to the nearest international airport could be viewed as a small price to pay for those who will be saving substantial amounts of money in tax. Especially when you consider that their properties could be rising in value quite significantly in the years to come.’

While property prices have risen in most parts of Europe, tax havens have outstripped most for property inflation.

Little 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 property specialists Tribune Properties 2007 is likely to see a further ten per cent rise.

‘There are three streams of buyers for Andorra’, say one local estate agency, ‘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.

New Hotels

In addition to attracting international buyers in increasing numbers for residency, the Andorra authorities have invested heavily in their ski infrastructure, boosting the country’s tourism potential and subsequently Andorra’s real estate market.

And for this year’s ski season Andorra has opened a new family friendly ski park in Arinsal, moving away further still from her old image of a cheap and cheerful ski holiday for 18-30 year olds to one that caters well for all.

One of the few drawbacks when taking residency in Andorra compared to Monaco has been access to a major international airport. While Monaco enjoys close proximity to Nice Airport, with a ten minute helicopter ride available, Andorra’s nearest airports have been Barcelona and Toulouse, three hours away, with no direct flights to Andorra.

Recent road improvements between Barcelona and Andorra has cut this by thirty minutes, and there is a possibility of a scheduled helicopter service, Andorra weather permitting, or more likely ten minutes from the Spanish Andorra border, allowing quicker access to international flights for business people considering Andorra residency.

Other improvements within Andorra include new tunnels, allowing quicker access to the ski fields, and driving around Andorra easier.

With more demand from international buyers who want to take advantage of Andorra residency, the Andorra government announced in February that it was increasing the number of residency applications from the previous 200 year a year to 500.

‘Andorra is becoming more popular among the international buyers’, comment a local travel guide, ‘And with Monaco real estate prices sky high it comes as no surprise that the government has moved favourably by allowing more residents. But it’s not just the tax free living they come for – it’s the Andorra weather as well for many who see the ideal opportunity to live in a tax free environment and enjoying winter sports too.’