Yes, it is possible to buy a property in Switzerland as a non-resident.
The acquisition of real estate by non-residents is regulated by Swiss Federal Law under the Lex Koller regulations. The Lex Koller requires "persons abroad" to obtain a permit from the appropriate cantonal and federal authorities before buying real estate in Switzerland.
This map of Switzerland shows that in certain areas of the main Cantons of Vaud, Valais, Fribourg, Bern, Neuchâtel, Ticino and Graubünden it is possible to buy property through the Lex Koller legal process.
Numbers of properties available to non-residents are also limited by the Swiss Government. At present the total number of homes that can be sold each year to non-residents in the whole of Switzerland is 1,440. Each Canton has a proportion of the 1,440 'permits' allocated to them each year.
It is possible to buy in most of the main ski resorts and tourist areas within Switzerland. The majority of the 1,440 permits are allocated to the south-west region of the country, namely Vaud, Valais and the Bernese Oberland.
Alternatively, if the property is to serve as a main residence, no permission is required provided that the property serves the purchaser as their main residence at the place of their rightful and actual residence, and provided that the purchaser actually lives there (renting out is not allowed). This is commonly known as the 'Permit B' route and involves acquiring Swiss Residency at the time of the property purchase.
Restrictions to note
When buying a property in Switzerland there are certain regulations that need to be adhered to:
- Non-Swiss families can only own one property in Switzerland at any one time and the size of the property can be a maximum of 200m2 internal livable floor area. For chalets the plot size is also limited to 1000m2. The term 'family' can be defined as husband and wife and / or under-age children. Over the age of 20, a child of an owner may purchase one property in their own name, provided they can prove financial independence.
- Certain Cantons place restrictions on resale of a property within a set amount of time. These regulations differ from Canton to Canton, but it is not unusual for a buyer to be restricted from resale within the first 5 years of ownership for example. Once this time has elapsed it is then possible to resell a property to another non-resident quite easily, subject to the Lex Koller law.
- An owner can occupy a property for up to six months per year with a maximum stay at any one time of three months.
- A property can be rented for a maximum of 11 months and 1 week per year.
EU citizens with a residence permit B and all foreigners with a residence permit C are not subject to the restrictions above.
A local Swiss Public Notary will act for both the purchaser and vendor to complete the transaction. He is there to protect the interests of both parties and he will draw up the deeds and documents required for legal ownership.
Notary fees, land registry fees and Government purchase taxes vary from Canton to Canton, in Valais for example, you will need to budget for 2.6% of the total property purchase price in fees, whereas in Vaud that figure is 5% and Bern 3%. The fees are payable by the purchaser, not the vendor.
All contracts are carried out in Swiss Francs.
Once the purchaser has choses an apartment, chalet or land the purchasing procedure through the Notary is straightforward.
- Complete personal details forms and Power of Attorney documentation.
- Payment of the agreed deposit to the Notary account.
- Signing of the deed of sale.
If the property is being bought by a non-Swiss resident then the Notary will apply on their behalf to the Cantonal authorities for an authorisation permit. The time taken to receive authorisation varies from village to village and depends on the current status of permit allowances and allocations in each particular area.
Once the authorisation has been received and the property completed, the notary will record the deed of sale with the Land Registry.
Particularly with apartments each purchaser acquires a share in the Propriete Par Etage (PPE), which means co-ownership by floor.
The total annual costs of an apartment building are shared between the individual apartment owners, proportioned according to the size of each apartment. As an estimate, the annual running costs of an apartment are around 0.8% to 1% of the property purchase price.
Typically these expenses include:
- Caretaker / social security contributions
- Maintenance of building and materials
- Water / gas / electricity and heating
- Insurance and various taxes
- Gardening and maintenance of roads
- Administration fees and various expenses
- An allocation to the building's renovation fund
In Switzerland, the owners of holiday property are subject to annual taxes. In total the taxes amount to around 1.3% of the property purchase price per annum.
This figure is made up of several small taxes including land tax, tourist tax and wealth taxes. Also included is a tax on estimated rental income from the property regardless of whether or not the property is actually rented during the year.
Taxes are paid to three bodies:
- The Swiss Government
- The Canton
- The Commune