Property prices have always been higher in Switzerland than almost anywhere else in Europe.
One of the main reasons for this is that Switzerland is a very small country, where building land is scarce, and therefore correspondingly expensive. In many parts of the country farming land cannot be zoned for construction.
This is particularly the case in densely populated urban areas — like Geneva — whose geography sets restrictions on land expansion.
READ ALSO: Why is the price of properties so high in Switzerland?
Driven by inflation as well as higher mortgage rates, real estate prices in Switzerland have soared in the past few years, especially in high-demand areas in or near cities, as well as in popular tourist areas — like the Swiss Alps.
Since 2021, for instance, fuelled by increased demand for homes, as well as the home-working obligation that was in place at times during the pandemic, prices of chalets soared by almost 10 percent.
That was the steepest price jump since 2008, according to UBS Alpine Property Focus report.
"Pandemic-triggered travel restrictions and requirements to work from home sparked a major run on vacation properties," the document reported. "The desire to own a home in the mountains was stoked up by the buoyant economic performance in 2021, as household incomes and assets also increased in parallel.”
This year, however, the price outlook for these mountain homes is more positive.
"We expect prices to stagnate this year on average — they could even fall a bit," UBS real estate analyst Maciej Skoczek said.
But that’s not the only good news for chalet-hunters. "In the coming years, we will likely see a turnaround: holiday-home prices will develop below the average of the broader market. That’s different from the pattern we've seen up to now,” he added.
Prices in some resort areas, however, remain higher than in others, so much depends on where you want to purchase.
Arosa and Flims-Laax in Graubünden, as well as Engelberg in Obwalden, are among locations that experienced the biggest price hikes across the Alps.
Overall, however, the most expensive real estate market is in St Moritz and in the Engadin Valley (both in Graubünden), where a square metre costs about 20,500 francs.
READ ALSO: How can I buy a second home in Switzerland?
If you decide to buy property in the Alps as a foreign national, consider this:
Generally speaking, foreigners are allowed to buy homes in Switzerland if they have a residence permit.
As for second homes, if you are not a resident or a citizen, you will need to get permission from the canton or municipality in order to buy.
However, several cantons are exempt from this requirement.
In Appenzell Ausserrhoden, Bern, Freiburg, Glarus, Grisons, Jura, Lucerne, Neuchâtel, Nidwalden, Obwalden, St. Gallen, Schaffhausen, Schwyz, Ticino, Uri, Vaud and Valais, you will not need to get permission to buy a holiday home.
There are rules also on what kind of holiday homes can be bought. The homes need to be under 200 square metres* and the plot itself must be less than 1,000 metres.
*The 200 square metres includes all rooms, kitchen, bathrooms etc, but does not include stairwells, basements, balconies and other areas.
There are other restrictions in place as well: municipalities which have more than 20 percent second homes (of their entire housing stock), can only approve the construction of second homes under certain conditions.
There are also annual restrictions at a national level. Only 1,500 holiday apartments can be sold to non-Swiss nationals.
This is imposed on a cantonal basis, meaning that larger cantons have more than 300 homes per year on offer while smaller cantons can have as few as 20.
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