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PROPERTY

Can foreigners buy property in Switzerland?

Switzerland’s foreign population is around 25 percent, while tens of thousands make the move Swiss-wards each year. Can foreign nationals buy a home in Switzerland?

A sign outside a house which says 'sale pending'. Can foreigners buy a home - or any kind of property-  in Switzerland? Photo: AFP
A sign outside a house which says 'sale pending'. Can foreigners buy a home - or any kind of property- in Switzerland? Photo: AFP

Despite the uncertainty that abounds in the wake of the coronavirus pandemic, one major constant in the Swiss economy has been property prices. 

As we reported earlier this year, while many experts feared that real estate market in Switzerland would collapse during the health crisis, the opposite has happened: rents, as well as purchase prices for houses and apartments have risen.

READ MORE: What does the coronavirus mean for Switzerland’s property market?

So with buying becoming a more attractive option for whoever can afford it, can foreigners in Switzerland buy property? 

And what are the rules? 

Here’s what you need to know. 

Can foreigners buy a home in Switzerland? 

The short answer to the question is ‘yes’, but a lot will depend on your legal status with regard to residency, the type of property you want to purchase and the country – and canton – in which you reside. 

Generally speaking, foreigners who legally reside in Switzerland will be allowed to purchase property, whether that be as an investment or for somewhere to live. 

READ MORE: Eight reasons why buying a Swiss home is easier than you think

Foreigners who live abroad are must abide by certain rules – popularly known as Lex Koller rules – when purchasing property in Switzerland. 

Can foreigners living in Switzerland purchase property? 

First things first, check your residency status. 

If you are living in Switzerland as an EU/EFTA citizen or have a C permit, you can purchase property – indeed you have the same rights as Swiss citizens when it comes to purchasing property. 

You do not need a permit or any additional permissions that a Swiss citizen would not require to purchase property. 

What about ‘third-country nationals’ who live in Switzerland? 

OK, so you might not be an EU/EFTA citizen, but you live in Switzerland from a non-EU country – making you a ‘third-country national’. 

If you have legal residency here (i.e. a B permit), you can buy property in Switzerland – provided you plan to live in the property (i.e. an owner-occupied flat/condominium, build on land which you own or a move into a family house). 

According to Swiss government information, in order to satisfy the residency requirement this will usually be a B Permit for foreign nationals. 

You will also need to continue living in the residence for the time you live in Switzerland. If you are building on land you own, you will need to do so within a year of purchasing the land. 

Where will third-country nationals need a permit? 

If the above does not apply – i.e if you will not live in the property and want to use it as an investment or if you do not have sufficient residency – you are likely to need a permit to buy property in Switzerland. 

According to the Swiss government, third-country nationals looking to own a holiday apartment, housing unit in a building or hotel or a second home will need to get a permit in order to do so.

This is where the ‘Lex Koller’ comes in. The Lex Koller is the set of rules for people to buy flats, houses or apartments in Switzerland who do not satisfy the above criteria.  

OK then, so how do I get one of these permit things? 

Cantons, baby.

This is regulated by the canton – so get in touch with your cantonal land registry office or inspectorate to get more information. 

Contact details can be found at the following link – you’ll just need to put in your municipality number and you’ll be redirected. 

The Lex Koller itself is complex and difficult to explain, with any number of exceptions and conditions. While some information is available at the following link, the best idea is to chat with a lawyer or property advisor about the matter. 

What about commercial real estate? 

Alright then Mr Big Bucks, that’s a whole other kettle of fish. 

Generally speaking foreigners are not restricted from acquiring commercial real estate provided it is non-residential, although the legal situation is a little shaky. 

The Legal Affairs Committee of the Swiss National Council recently banned the purchase of commercial real estate in Switzerland by foreign nationals in some cases. 

I bought a flat in Switzerland – do I now get a residency permit? 

No. This is emphatically ruled out by the Swiss government. 

“Owning real estate in Switzerland does not confer any entitlement to a residence permit,” says the official guidance. 

READ MORE: How wealthy foreigners can ‘buy’ a Swiss residence permit

Is the law likely to change? 

The status quo has remained for some time in Switzerland despite efforts to change it, therefore it doesn’t appear there will be changes anytime soon. 

In early 2017, the Swiss government proposed changes that would have made it more difficult to foreigners to buy both property and blocks of land in Switzerland.

The proposals also envisaged tighter restrictions on the purchase of commercial property and on investment in real estate firms as a way to close loopholes in the current legislative framework.

READ MORE: Switzerland snubs tougher rules on foreign property ownership

Supporters of the changes had argued foreign investors were pushing up property prices and rents in Switzerland.

But opponents said the restrictions would harm the country’s economic growth. They also argued population growth and a desire for more square metres were pushing up prices, and not foreign investors.

After a consultation process, the Swiss government has said there is no need for further action at this time. It will, however, look at the possible limits on foreign investment in Swiss firms in specific circumstances.

Note: As with all of our guides, please keep in mind that this is intended as information only and does not constitute legal advice. For more specific advice to your set of personal circumstances, please contact a lawyer or property advisor. 

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LIVING IN SWITZERLAND

Reader question: How can I find a good lawyer in Switzerland?

Although you hope to never need one, sometimes you might have to seek legal advice in Switzerland. This is how to find it.

Reader question: How can I find a good lawyer in Switzerland?

When you move to a new country, including Switzerland, you have to look for a whole new network of professionals.

You may or may not have immediate need for the proverbial butcher, baker, and the candlestick maker, but sooner or later you will have to find other professionals, with the most essential one being a doctor.

READ MORE: What you should know about finding a doctor in Switzerland

Chances are you will also need, at one time or another, a legal counsel. That should in principle not be a problem as Switzerland has an abundance of lawyers — 7,317 currently practicing in the country, according to European data.

The question of how to find one that best suits your needs depends on many factors — for instance, what kind of legal advice you are seeking (estate planning, inheritance, divorce, etc), whether you speak the language of your region or need an English-speaking attorney,  and whether you can pay (the often exorbitant) fees, or need free counselling instead.

Speaking of fees, the hourly rates vary widely from one lawyer or legal practice to another, with some charging as little as 100 francs or as much as 1,000.

Much depends on the lawyer’s location — with the ones practicing in large cities like Zurich and Geneva being more expensive than their counterparts in small towns or rural regions  — the area of specialisation and general reputation — the more prominent the attorney is with a roster of famous or well-heeled clients, the higher fees they will typically charge.

An important thing to know is that, depending on the advice you are seeking, you may not need a lawyer at all, but rather a public notary; in Switzerland, these professionals perform many tasks that only attorneys can do in other countries, such as drawing contracts and establishing other legal documents.

Here are some tips on how to find a lawyer or a notary that best fits your needs:

Word of mouth

As with any other services, personal recommendations from people you know and trust are best.

This will spare you the effort of “investigating” the person, such as researching their credentials and feedback from previous clients — the due diligence process that everyone should undertake before hiring any professional.

Professional associations

If you don’t know anyone who can recommend an attorney, do your own research.

Professional organisations such as the Swiss Bar Association (SBA) and the Swiss Federation of Notaries are good resources, as they both allow you to look for professionals in or near your place of residence.

English-speaking attorneys

Many Swiss lawyers and notaries, especially those practicing in large urban centres where many foreign residents live, speak English.

But if you want to make sure yours does, the UK government put together a list of English speaking attorneys in Switzerland, which should help you with your search.

‘Free’ legal advice

In principle, all legal assistance comes at a cost, except for exceptional cases, which are defined by each canton.

SBA has a canton-by-canton list, where the designation “GRATIS JUDICATURE” stands for “free legal advice”.

However, there is also such a thing in Switzerland as “legal protection insurance” (Rechtsschutzversicherungen in German, protection juridique in French, and protezione giuridica in Italian).

It covers attorney and other associated fees if you undertake court action against someone, are sued, or simply need legal advice.

There are two different types of legal protection insurance — one specifically for traffic accidents and the other for all other matters. Sometimes they are combined.

Typically, this insurance covers costs of legal representation associated with contract disputes, employment, loans and debts, healthcare, housing, retail purchases, and travel.

The annual cost of this insurance, which you can purchase from practically every carrier in Switzerland, is minimal, especially if you consider how much you’d have to spend if you hired an attorney yourself.

Another benefit of these policies is that a lawyer will be assigned to you by the insurance company so you won’t have the headache of looking for one on your own.

This article provides more information about this insurance:

EXPLAINED: Why you need ‘legal protection insurance’ in Switzerland

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