Buying Guides >> Property in Switzerland | Property in France
A guide to buying property in Switzerland
A recent moratorium prevents the sale of property
to foreign buyers during 2007 in seven areas in
the Valais Canton - namely Grimentz, Veysonnaz,
Nendaz, Bagnes (Verbier), Hérémence,
Riddes and Val d’Illiez. 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. No new
permits to purchase will be granted to foreign
buyers during 2007 for the seven areas of Grimentz,
Veysonnaz, Nendaz, Bagnes (Verbier), Hérémence,
Riddes and Val d’Illiez in the Valais Canton.
Property type and location
Generally, non-Swiss citizens can only buy one
property of a specified size per family. Only
certain properties are authorised for sale 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.
Property deposit
The Swiss notary requires a deposit to start the
purchase process. The amount of deposit depends
upon the value of the property being purchased.
Survey
New buildings have a construction guarantee.
Re-sale
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.
Laws
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.
Taxes
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.
Mortgages
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.