Swiss Property Guide | FAQs | Property Switzerland

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Frequently asked Questions for buying a Property in Switzerland

General Questions
Buying Process
Legal
Payment terms
Rent
Residency in Switzerland
Taxation

GENERAL Swiss Property Questions

Why is Switzerland a secure investment?
As Switzerland pays a lot of attention to the aesthetics of the country, there will never be overbuilt zones. For this reason, the demand will always remain greater than the number of properties available a good balance for a great investment.
What is the tenure / lease and for how many years?
All properties in Switzerland are freehold.
Is there a Swiss equivalent of the NHBC (National Housing-Building Council)?
Most builders give between 5 and 10 years guarantee for new constructions. The building permission is subject to many regulations and therefore no property will ever be built before having adhered to the strict requirements regarding location (no risk zone), ground (stable) and many others.
What about inspection trips?
We are happy to organise the accommodation for you. We are bi-lingual and we will welcome you here and show you all the properties that could be of interest for you as well as everyone you need to see or speak to.

BUYING PROCESS in Switzerland

1 Please explain the buying process including details of the solicitor as well as their costs. Does one need a UK solicitor?
When one decides to buy a property, the Swiss solicitor will be introduced to you. One does not need a UK solicitor. The solicitor's fees (which also includes the stamp duty) in Le Valais are equal to 2.5% of the purchase price and 4% in Vaud.
Does one sign an English Document or a Swiss one?
One must sign a Swiss document (this document is in French), which can be translated into English for you
3 How many people can buy a property together? Is it more advantageous to purchase a property in a limited company name or in our own names?
One can buy a second house in one or maximum 6 names. When one purchases in a company name, one may only buy commercial properties (e.g. a hotel, restaurant or buildings specifically for tourist purposes), not a holiday home.
Can one purchase a property in Switzerland from England?
Yes, this is possible. In this case the client signs e a power of attorney on the client's behalf as well as a copy of the sales act. The procedure would take place in the presence of a solicitor in London so that the relevant documents can be signed on your behalf in front of the solicitor in Switzerland.
What are the additional costs (solicitor, taxes, agency fees, etc.)?
Depending on each canton, these costs vary between 3.5% in Le Valais and 5% in Vaud.
Are there a minimum number of days one must spend in Switzerland before purchasing a property?
No, there is no specific number of days which one has to spend in Switzerland.

LEGAL Procedures in Switzerland

What is the Lex Friedrich?
The Lex Friedrich is a law, which sets the guidelines for foreigners buying properties in Switzerland so as to avoid any speculation with regards to real estate. In this way the Swiss market remains stable and thus guarantees a safe investment.
Why was the change in the Lex Friedrich advantageous for foreign property buyers?
In June 2002 the Lex Friedrich (Mention Epiney) was altered slightly: It has now become possible for a foreign buyer to purchase a Swiss property from a foreign seller without any subscription to the Legal Service for the purchase authority. This therefore means that there is no time delay. Previously, foreign buyers were not entitled to purchase properties with a liveable surface area of more than 100 square metres. Now that the Lex Friedrich has changed, foreigners are able to purchase properties with a liveable surface of up to 200 square metres. The annual quota allowing foreigners to buy has remained the same: 310 per year in the canton of Le Valais. This quota is now due to disappear, it is just a question of months.
Death duties in Switzerland?
In cantons such as Le Valais there are no inheritance taxes. In Vaud, the overall rate depends on the political commune where the deceased person was last domiciled. The rate prevailing at the cantonal level is set by the law. The maximum cantonal rate applicable for spouse, children and grandchildren is 3.5%. The maximum rate for parents and grandparents is 7.5% and 12.5% for brothers and sisters. Such rate increases up to 25% when there are distant or no family ties between the parties. The rate prevailing at the communal level is set each year by each commune. The communal rate can go from 0 to 100% of the applicable cantonal rate and will depend on the family ties between the parties.
Do I need a Swiss will?
Not necessarily, only if you prefer to have one.
How many properties can one own as a foreigner in Switzerland?
One is allowed to be the owner of maximum 1 property. It is however possible to purchase a second property in the name of a family member as long as they are above the age of 20 years old.

PAYMENT TERMS

What is the currency of payment and does it have to be paid into a Swiss account?
The sum is paid in Swiss Francs (CHF). It indeed has to be paid into a Swiss bank account.
I understand that it is preferable to pre-qualify prospective customers to ensure that they can obtain a Swiss Mortgage. What paperwork is required for this procedure?
* A signed copy of your passport (the signature must be in blue ink)
* A P60 or Profit & Lost Account if one is self-employed for the last 3 years
* A credit check.
Here are some telephone numbers:
* Experian: 0870.241.6212 (the fastest)
* Equi Fax: 0870.514.3700 or 0845.745.6000
How much can we borrow?
Depending on the client's details, the mortgage fluctuates between 50% and 70% of the purchase price.
Who is the mortgage with?
We like to give the freedom of choice to our clients as to which bank to use, although it is recomended in some cases to use one bank since special advantages may be given if one bank is the appointed one for the financing for a development.
Here is the one we advise:
Fortis Bank, Mr Phillipe Fournier
Place du Midi 31
1950 Sion
Tel: +41 58 322 0 080
Fax: +41 58 322 0 099
email: info@fortisbanque.ch
Or visit the website: www.fortisbanque.ch
How long can we have a mortgage for (Credit Suisse)?
One can have a lifetime mortgage, which we do always recommend. For persons younger than 50 years, next system applies:
* Up till the age of 60 years, one has to have paid half the property price
* From the age of 60 years, it is an interest-only repayment

Example:
Purchase price = 1,000,000 CHF (+ 3.5% purchase costs = 35,000 CHF)
34% equities 340,000 CHF
66% mortgage 660,000 CHF
Eg.: If you were 40 years old:
20 years to go before 60 years
16% (half the property price, 50% � equities, 34%) to pay before 60 y
= 16% x 1,000,000 CHF
20
This means the annual repayment will be 8,000 CHF to be paid twice a year.
Can one have Swiss bank accounts and credit cards in our own names?
Yes, this is possible.
Why is it beneficial to take out a mortgage in Switzerland?
The Swiss mortgages are advantageous as the interest rates are very low; generally the lowest in Europe.

RENT Property in Switzerland

Is there someone to manage the property?
Yes, there are property management companies in most of the villages to provide you with those services.
How high are the maintenance fees?
Between 0.8% and 1% of the property price, depending on the size and value of the property.
Is owning a property in a ski resort only enjoyable and beneficial during the winter period?
In most villages the winter and summer seasons are equally popular for many different reasons: activities are organised, such as volleyball competitions. One can also take advantage of the golf courses, tennis courts, lakes, swimming pools, hot tubs, a fitness centre or the possibility to hike in the mountains as well as para mounting or rock climbing.
What is the weekly price per apartment based on?
* The rating / standard of the property in terms of the number of stars
* The number of bedrooms and overall size of the property.
* The season

RESIDENCY IN SWITZERLAND

What residents' permits is required in order to buy and sell property in Switzerland?
For a non-Swiss-resident purchasing a Swiss property there is a permit called �permit de séjour. This entitles the future owner the right to stay at/in their property between 3 weeks and 2 months. Any clients purchasing who are over the age of 56 may apply for a permit B which will enable them to stay for more then 6 months a year without exercising any professional activity. In order to obtain the �permit de séjour, AM Services SA compiles a dossier containing the client's details. This dossier is then presented to the Commission of the relevant Canton for them to give their authorisation.
Can I sell to Swiss Nationals?
Yes, one is able to sell to Swiss Nationals.
How long does it take before obtaining a resident's permit?
This depends on the canton and the property. For the canton of Le Valais this can take between 6 months and 3 years (for areas such as Verbier and Crans Montana where the demand is huge) for resale properties from Swiss owners or off-plan properties. For a foreign vendor selling his property to a foreign purchaser there it takes up to 2 months to be registered. For the Canton of Vaud the waiting time is much less being about 2 months.

TAXATION in Switzerland

Are the capital gain taxes subject to IHT in Switzerland and/or England?
The amount of taxes depends on how long one has owned the property for. Taxes are subject to IHT in Switzerland. The longer one keeps his property for, the less taxes he pays.
Is there tax payable on the rental income?
Yes, but in some cases the taxes on the income are offset by the interest on the mortgage.