Purchase a Property in Switzerland
Purchase a Property in SwitzerlandUpdated on Thursday 17th March 2016
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Are there any restrictions if wanting to purchase a property in Switzerland?
There are several restrictions applied to foreigners wanting to buy real estate properties in Switzerland. These restrictions refer to quotas for Swiss residence permits imposed to foreigners because one must obtain a residence permit in order to be allowed to acquire a property. These restrictions depend from canton to canton. Even foreign or Swiss companies with over 30% foreign ownership have restrictions when buying property. Some cantons impose restrictions on the area a property can have, other put restrictions on how many properties foreigners can buy in Switzerland, while other on the timespan a property can be resold.
What are the main steps when buying property in Switzerland?
Despite all the restrictions when an investor has decided to purchase a Swiss property the process is quite simple. The first step is to request the services of a public notary. The notary will draft an agreement for the purchase of property (promesse de vente) and around 10% of the property’s price will be deposited with the notary. However, the agreement will not be drafted until the notary does not receive the permission of the competent cantonal authorities. It takes about two to three months to receive permission. It is also important to know that the authorities may impose certain conditions on the use of the real estate. Once the permission was granted and the contract is signed, the buyer must deposit the rest of the payment with the notary. The notary will then register the property with the Swiss Land Register and give the rest of the money to the seller. The registration should not take more than two weeks if all the requirements are met.
What are the costs related to property purchases in Switzerland?
The transaction fees when buying a property in Switzerland are lower than in Germany, for example. The notary fee will be around 0.2- 1%, the registration fee 0.25% and the property transfer tax that depends from canton to canton ranges between 0 and 3.30%. Zurich no longer levies the property transfer tax. The VAT rate also varies when purchasing properties in Switzerland.
Our Swiss law firm can provide you with information about the most advantageous cantons to buy property in. You can also contact us for details on the taxes and registration when buying property in Switzerland.