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Buying properties in Switzerland

In Switzerland, about 37.4% of the local population owns their home. Most often, people over 65 living in the countryside own their own homes. Due to the overpopulation of large cities, high demand for housing, and paperwork for buying a home, the Swiss purchase real estate in the countryside.

Buy property in Switzerland

Buyers and tenants need to know how the price is formed, where it is more profitable to look for accommodation, and what difficulties arise when buying property in Switzerland.
Suisse Immobilien Group has been a trustee of professionals managing real estate in the country for many years. The company shows the local market's peculiarities to all interested in Swiss property. Suisse Immobilien Group builds its work on confidentiality and individual approach.

Should you rent or buy a home in Switzerland?

Why have you decided to journey to Switzerland? Are you a student, a transient laborer, or do you long for a holiday in the alpine paradise? As a foreigner, you can rent a dwelling without any restrictions, but purchasing property has its intricacies. To decide between renting and buying, you should weigh factors such as finances, location, and legal considerations. The following segments will delve into the traps of procuring real estate in Switzerland.

Real estate market in Switzerland: prices, best locations, pitfalls

Compared to other EU countries, real estate prices in Switzerland are high. Between 2000 and 2016, prices jumped by 80%. The next step of the Swiss government was to lower the cost artificially. The subsequent significant increase was in 2020, but only by 2.1%.
At present, a square meter in Zurich costs CHF 12,938, CHF 13,967 in Lausanne, and CHF 13,426 in Geneva. Average house prices across the country are CHF 1,10,000. Local banks are willing to provide loans to purchase real estate at less than 4% per annum.
It is worth contacting the Chamber of Commerce and Industry to get the most up-to-date information on the local property market.

Can foreigners buy property in Switzerland?

Before considering buying a Swiss property, let's first answer a vital question. Can you do it? And what should you do first to be able to purchase property in Switzerland? The visa issue is crucial for you if you are an expat interested in real estate.

Foreigners of any origin vs EU / EFTA citizens not residing

Non-resident aliens have the same rights as residents when buying a home in Switzerland if they are:

  • EU citizens;
  • EFTA citizens;
  • who have a C permanent residence permit in Switzerland;

In other words, this category of foreigners can buy property for recreation, investment, business, and permanent residence.

A B residence permit grants non-residents the privilege of procuring property solely for permanent residency.

Those who are prohibited from purchasing real estate are:

  • do not fall into the above categories;
  • do not have a work permit in Switzerland;
  • have a short-term or seasonal work permit.

The second category of foreigners can apply for a permit to purchase real estate, but the rules differ from region to region.

The process of foreigners' real estate acquisition, also called the "Federal Law on the Acquisition of Real Estate by Persons Abroad," is overseen by the Lex Koller law.

Working in Switzerland and living elsewhere

If you want to work in Switzerland but prefer to avoid dealing with buying or renting real estate, there is another option. People become border guards on the Swiss boundary with Germany or France, rent or buy a home abroad, but travel to Switzerland to work if they have a work permit.

Costs of buying property in Switzerland

Compared to the rest of Europe, taxes on home purchases in Switzerland are meager. The property seller bears the expenses spanning from 3.23% to 5.38%. However, the buyer is subject to varying tax rates based on the canton:

  • the real estate transfer tax is 0 in Zurich and Zug and from 1% to 3.3% in other cities;
  • property tax 0.01-0.03% on average in the country;
  • the registration fee is 0.15%.

Another expense when buying real estate will be a notary fee of 0.1% of the total cost.

Finding the best property to buy in Switzerland

If you've decided to rent or buy a home in Switzerland, we have some tips on where to look. Newspapers with classifieds are still part of the communication between customers and sellers. The advantage is that they are free. The disadvantage is that the ads may no longer be relevant. Online resources are also in great demand and free, but you will have to solve all the issues yourself at the risk of encountering fraudsters. The most convenient option is a trusted real estate agency because the teams have been building their experience in renting or buying housing for years and know the region's specifics.

Major online real estate portals to look up property

Each country has its proven online resources for independent real estate searches. On these sites, agents and property owners post ads about prices and conditions for housing. In Switzerland, these are:

Find a real estate agency in Switzerland

In Switzerland, there are unions and organizations of real estate professionals where you can find information about individual agencies and trustees and ensure they are competent. For example:

  • The Swiss Union of Real Estate Professionals – is an association of real estate associations in French-speaking cantons;
  • The Swiss Real Estate Association SVIT – is a club of real estate professionals that provides support and encourages their development;
  • APF-Hev Association – is an association of landowners.

The largest real estate agencies in Switzerland:

  • Moser Vernet & CIE;
  • Wincasa;
  • Privera;
  • Naef (French speakers);
  • SPG (French-speaking);
  • Suisse Immobilien Group (Multi-language).

Why choose working with Suisse Immobilien Group?

Suisse Immobilien Group is a real estate trust company with a rich history. Mr Maurizio Botti founded the company and is currently managed by his sons Filippo, Martino, and Paolo Botti. The company is firmly woven into the fabric of Swiss real estate and has close relationships with funds, banks, and investors.

The Suisse Immobilien Group is a certified member of the Swiss Real Estate Association SVIT and the APF-Hev Association of Landowners.
The company is committed to professionalism, confidentiality, and deep knowledge of the local specifics of Switzerland, valuing its clients as family members and basing its work on the profile of each client.

How to buy real estate in Switzerland

Once you've discovered the abode of your dreams, the real work begins. You must muster the courage to put forth an offer, navigate the complex waters of mortgage options, agree with the seller, and ink a binding contract.

This can be a slow and intricate process, especially in Switzerland, where it can last upwards of three months. And remember to keep a healthy chunk of change set aside, as fees can quickly gobble up 5% of the purchase price, with property transfer taxes in certain areas ringing in at a steep 3%.

Choosing a property in Switzerland

In Switzerland, requesting a professional inspection of a property you're interested in purchasing is not customary. The seller is under no obligation to disclose any problems. A survey can provide invaluable information about potential problems, especially for older properties.

Properties in Switzerland come in all shapes and sizes, ranging from sprawling standalone homes to compact units in enclosed blocks. To ensure that newly constructed homes meet sustainability and energy efficiency standards, Minergie has emerged as the benchmark, with 10-25% of new buildings in various regions earning Minergie certification over the past two decades.

In Switzerland, even detached homes may have yearly service charges to cover the maintenance of common spaces like parking lots, boat docks, or private roads. The fee for flats can run around 1% of the purchase price per year.

Swiss property taxes vary widely between municipalities and cantons, so it's wise to inquire about taxation rates while exploring potential properties.

Getting a Swiss mortgage

In Switzerland, before you can offer a property, you must first secure a mortgage from a bank. However, it is possible to arrange a mortgage directly with lenders. Many people work with a mortgage broker who can help facilitate negotiations with the seller and the lender. The broker can also sign the contract on behalf of the client.

When you apply for a mortgage, the lender appraises the property you're eyeing and determines whether you qualify for a loan. To qualify, you'll typically need to put down at least 20% of the property's value, with at least 10% of that amount being in cash.
If you can scrape together the required 20% deposit, you'll likely be able to afford a Swiss home.

Making a real estate offer in Switzerland

The amount you can borrow via a mortgage will significantly affect the size of your offer when purchasing a property. Once you've settled on a request, you'll need to communicate it to the seller via your real estate agent or directly. It's worth remembering that in Switzerland, estate agents tend to work for the seller, so take their claims with a grain of salt.
If the seller accepts your offer, you may be required to pay a deposit at this point, which a notary will hold in escrow. To ensure you have a clear understanding of when and under what circumstances the deposit will be forfeited or returned, it's essential to have a written agreement.

It's also critical to inform your mortgage provider that your offer has been accepted and to complete any remaining paperwork. The mortgage company will notify the notary that the payment has been made and that the sale can proceed.

Completing a real estate purchase in Switzerland

When you buy property in Switzerland, a notary manages the transfer of title. In some cantons, notaries are civil servants who work with both the buyer and the seller.
The notary is responsible for the following:

  • drawing up the contract;
  • secure storage of the buyer's funds in escrow;
  • conducting the official transfer of property;
  • registration of the change of ownership;
  • ensuring compliance with all legal requirements;
  • providing recommendations on the legality and legitimacy of the transaction.

A notary is an indispensable figure in the property transfer process. His role is to protect the interests of both the buyer and the seller while ensuring that the transaction is carried out smoothly and without any delays.

Sale contracts in Switzerland

In Switzerland, it is common for a public notary to draw up a purchase contract, and in some regions, this is even required by law. However, if you want to delve deeper into the localities or communicate fluently in the local language, it is advisable to consult a lawyer.

Under Swiss law, buyers and sellers must be fluent in the local language or have an authorized person sign on their behalf. If this is not the case, they must appoint a capable representative to act on their behalf.

It's crucial to understand every aspect of the sales contract to ensure that you're making an informed decision and to prevent any issues from arising in the future.

Moving into your Swiss property

Insurance

In Switzerland, two types of home insurance are available for homeowners:

  • contents insurance to protect household possessions;
  • third-party liability insurance from covering accidents involving visitors to your home.

The following types of insurance are optional.

On the other hand, building insurance is a must-have if you're planning to buy a property in Switzerland. This type of insurance usually covers damages caused by natural disasters like fires, floods, and other calamities. Moreover, you can add additional coverage to your policy to safeguard your property from unforeseen events.

Utilities and telecommunications

Aside from securing insurance coverage, you must set up utilities such as electricity, water, internet, and television services. Private companies in Switzerland typically provide these, so it is necessary to explore your options to find the most suitable rates and services.

Building a house in Switzerland

If you have the ambition to build your property in Switzerland, you can acquire a permit. However, remember that Swiss land comes with a hefty price tag, with rates ranging from CHF 150 to over CHF 2,000 per square meter. The average cost typically falls at CHF 350 per m/sq.

Remember that the construction costs vary based on the type of house, number of floors, and materials used. Fortunately, you can find cost calculators available online to help you better understand how much it will set you back.

Selling a house in Switzerland

The sale of a house in Switzerland is accompanied by costs for the seller of 3-5%. If you use an agency, expect a commission of at least 0.5% of the sale price. Capital gains tax is also applicable to the sale of real estate in Switzerland, and you may also be subject to tax if you decide to gift the property to someone.

As the seller, you are obliged to inform the buyer of any defects in the property.
Selling a property in Switzerland is a complex process with several stages. First, you must set a selling price based on an expert or online valuation tool. Then, you need to create a detailed sales document that showcases the best features of your property with high-quality photos, floor plans, and a compelling description.

You can turn to organizations such as the Swiss Association of Real Estate (SVIT), the Swiss Union of Real Estate Professionals (USPI Suisse), or the Suisse Immobilien Group to find a reliable agent.

Once you have found a buyer, you must draw up a contract with a notary to ensure that all legal requirements are met. Depending on the canton, this notary may be public or private.

Renovating a house in Switzerland

If you are buying a home in Switzerland that was built before the 1980s, consider a partial or complete renovation. Doing so will significantly improve your quality of life, improve energy efficiency in the long run, and increase the market value if you ever want to sell the house.
A complete renovation of your Swiss property can cost several hundred thousand francs. It is wise to set aside a certain percentage of the new building value - approximately 1-1.5% or more each year - for renovations, ideally from the start, and to repair the building in stages.

Want to learn more?

You have read the detailed instructions on how to buy a home in Switzerland, who can do it, and what you need to consider at the post office. Do you still have any questions? Do you have a more specific situation?

We will be happy to answer your questions. Fill out the contact form, and we will get back to you as soon as possible.