Tue, 09 Aug 2022

Whether it be the rich scenery of its snow-laden alps or the market blooming with hot chocolate and fondue, it is clear that Switzerland is a place that is desired by many to call home.

It is not challenging to purchase or sell houses online in Switzerland in today's modern world, provided that an individual has sufficient and accurate information to do so.

The Swiss housing market may be somewhat confusing for foreigners coming to Switzerland. House prices vary significantly from one place to the next, and the laws governing foreign ownership and Swiss financing may be perplexing. This article will guide you on acquiring real estate in Switzerland as an expat.

Basic Rules

The Lex Koller legislation is the overarching collection of laws determining where non-Swiss residents can own property and necessary licenses.

Non-Swiss residents can buy property in designated 'Holiday Zones,' mainly in ski resorts and Montreux and Lake Lugano.

The maximum size permitted in these regions is 200 square meters of official living space per identified individual, excluding balconies and basements.

The legislation may give concessions if a buyer's children study in Switzerland or acquire through a Swiss-based (and majority Swiss-owned) firm. A public lawyer can negotiate the benefits mentioned above.

Some cantons and communes have additional regulations governing ownership, taxation, and the number of properties owned as second homes in a given region (Lex Webber).

Equity

The importance of equity is immense. You must invest at least 20% of the purchase price in becoming the owner of your primary Swiss house (also called "personal contribution" in other countries). Even if your salary enables it, you will be unable to purchase an apartment or house without it, and this is a norm that all banks and cantons follow.

In Addition to

You'll need to account for the costs of the purchase deed and schedule in addition to the 20% equity (for example, "notary fees" in France). The notary's and canton's fees are different. The bank or your second pillar will not be able to cover your notary fees. Buyers are required to pay in cash.

For illustration purposes, these expenditures would be roughly CHF 56,000 for a house in Geneva with a purchase price of CHF 1,000,000.

Borrowing Capacity

You should also assess your borrowing capability in addition to your equity. The goal is to figure out the most significant amount you may borrow so that your income can meet the mortgage in the future. This phase will also help you narrow your search by focusing on houses within your price range.

Arranging mortgages

You must first apply for a mortgage with a bank before making an offer. Mortgages can be established directly with lenders, but a mortgage broker can also arrange mortgages, which negotiates between the seller and the lender and, if necessary, signs the contract on behalf of the customer.

When you apply, the lender evaluates the worth of the property you want to buy and determines whether or not to lend you money. A minimum deposit of 20% is usually required, with at least 10% in cash.

As previously noted, the bank will lend you up to 80% of the buying price. This total divides into two halves, which we refer to as rankings. In many countries, like France and Spain, you pay back the entire loan over a set length of time. A portion of the first-rank mortgage loan in Switzerland is non-depreciable, meaning you only pay interest. You are in debt to your bank if you do not repay the principal amount of the loan.

It may appear different from what you're used to, but you can save money on your taxes because the interest is deductible. The remaining (second rank) is depreciable, and you must repay both the good and the principal.

Completing The Purchase

In Switzerland, a notary handles the contracts. Notaries are public officers who work for both the buyer and the seller in various Swiss cantons. The buyer may recommend a notary, or you may choose one yourself.

In most cases, the notary will draft the contract and hold the buyer's funds in escrow. After that, you must execute the official property transfer, register the change of ownership, and ensure that all legal requirements are complete. They'd be able to advise on a transaction's authenticity and legality.

Insurance and Utilities

If you buy property in Switzerland, you will need to get building insurance, which usually covers fire, flooding, and other natural catastrophes, with additional coverage available.

Contents insurance for personal belongings and third-party liability insurance for visitors to your home are two optional home insurances in Switzerland.

You'll need to arrange suppliers for things like energy, water, internet, and television in addition to insurance coverage. When it comes to most of these items, the Swiss market is highly private, so you'll have to shop around to uncover the best deals.

We hope that we made the purchase or Sell House Online in Switzerland easier for you through this article. We highly recommend you thoroughly research before concluding to avoid any future regrets.

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