Buying Experts for Luxury Swiss Property
A guide to buying property in Switzerland
A moratorium currently limits the Swiss property for sale to foreign buyers in ski resorts in Valais. Buyers with a Swiss
permit B or C are unaffected by the ruling. Elsewhere
in Switzerland the restrictions on non-Swiss citizens
buying property have become more relaxed in the
last few years, though some federal and cantonal
laws still apply.
The information below is an overview of the considerations for buying property in Switzerland intended for reference only. It is not legally binding. Alpine Specialist is able to provide more detail on the property purchase process and introduce buyers to any Swiss property advisors required.
Essential facts for buying property in Switzerland
Purchase process overview
To acquire property in Switzerland buyers must instruct a Swiss notary (Notaire) who will obtain a permit to purchase (if one is required), ensure all legal formalities are dealt with and register the property purchase. The appointed notary also represents the property seller and oversees the property sale and purchase. The purchase is completed on registration at the Swiss Land Registry. Buyers may also need advice from a Swiss tax advisor on Swiss tax implications and a Swiss property lawyer on any legal implications.
Permits to purchase
Foreign buyers without a Swiss permit B or C need a "permit to purchase" (or "authorization") to buy property in Switzerland. Authorisations are obtained through a Swiss notary who applies to the relevant cantonal authority. Each Swiss Canton has a yearly quota of authorizations and it usually takes 3 months to obtain one. Under the current ruling only a restricted number of new permits to purchase will be granted to foreign buyers in ski resorts in Valais.
Property type and location
Generally, non-Swiss citizens can only buy one property of a specified size per family. Only certain Swiss property for sale is authorised to foreign buyers, and these are usually in popular tourist destinations such as ski resorts. In some cantons, it is only possible to buy a certain type of property, such as an individual chalet. Ownership of property in Switzerland does not give residency to the owner. EU citizens with a Swiss permit B (and all foreign buyers with a permit C) can buy as many properties as they like.
The Swiss notary requires a deposit to start the purchase process. The amount of deposit depends upon the value of the property being purchased.
New buildings have a construction guarantee.
There may be resale restrictions on the bought property: in some Swiss cantons foreign buyers can not sell their property within 5 or 10 years of purchase. There may also be restrictions on renting out the property.
Swiss inheritance laws apply to property bought in Switzerland. Buyers are advised to make a will which refers specifically to the property, and to lodge a copy of this with the Swiss notary.
Owners of property in Switzerland pay annual property tax, which is a percentage of the purchase price of the property. Each canton has different tax rules.
Capital gains tax also varies from canton to canton and it may be possible to offset property renovation costs against any capital gains tax payable.
Rental income is not taxable in Switzerland, but may be taxable in your country of residence. Mortgage interest can generally be offset against any rental income earned on the property, which also minimises the amount of annual tax payable.
Interest rates are low in Switzerland and as a rule Swiss banks offer very generous terms over a lengthy mortgage period.
Other purchase costs
Property purchase costs, which vary from canton to canton, include notary fees, land registry fees and Swiss government purchase taxes. In the Valais canton purchase costs typically amount to 2.5% of the purchase price while in the canton of Vaud they are typically 5% of the total purchase price.
Buyers of an apartment in a co-owned building must also contribute to annual running costs of the whole building. Costs differ from property to property and are generally divided up between the owners in proportion to their apartment size. Payable yearly, half-yearly or quarter-yearly they cover outgoings such as administration and expenses, a caretaker, insurance, garden and pathway maintenance, utilities and building maintenance costs.