Non-residents of Switzerland are permitted to buy a holiday home in Switzerland however there are numerous restrictions for foreigners (due to the “Lex Koller” and “Lex Weber” laws). Please see "Restrictions for Non-Residents" for more information.
Ski Property Purchase
An official Swiss notary of the district acts on behalf of both the purchaser and the vendor. When buying a new property under construction the buyer signs a reservation agreement and pays a small deposit. Then they complete a civil status questionnaire including personal details which the notary uses to apply for a permit for the buyer to acquire the property.
Within 30 days of being allocated a permit the buyer must sign the notary’s deed of sale – often by Power of Attorney - and pay a deposit.
Once deed has been signed, the notary records the deed of sale with the Land Register.
Usually a sale to a foreigner will only be refused if the purchaser already owns another property in Switzerland. The purchase contract will be made conditional upon authorisation being granted.
Property Type & Location
New Build Ski Property
In a referendum in 2012 – the Lex Weber - Switzerland voted to prohibit all new construction of second homes in communes which already have over 20% of second homes. The effect is that no more new properties will be built in future in most Swiss ski resorts.
New developments that received a building permit prior to March 2012 will continue to be built over the next two or three years but when these have been sold no more new properties will be built. This affects both foreigner buyers and Swiss residents who would like to buy a holiday home.
Re-sales Ski Property
Some cantons have resale restrictions, such as to prevent a foreign buyer from selling their property within 5 or 10 years of purchase. There may also be restrictions on renting out the property.
Each canton has different rules and regulations that also vary from commune to commune within the same canton.
Grindelwald: Non-Swiss nationals may purchase a ski chalet or apartment if the market value is in excess of CHF 750 000
Wengen and Lauterbrunnen: Non-Swiss nationals may purchase ski apartments but not detached chalets. Only 50% of the apartments in one building may be sold to foreigners. Foreigners may resell at any time.
Non-Swiss nationals may buy most properties but may not resell for 5 years. Foreigner permits are freely available for both re-sale and new properties.
Nendaz, Les Collons, Veysonnaz, La Tzoumaz: Foreign permits are allocated every three months, and foreigners must wait 5 years to resell to another foreigner, special circumstances permitted.
Zermatt: Non-Swiss residents are not able to purchase a ski apartment or chalet here.
Sass Fee: Non-Swiss residents may buy property from other foreigners, but they are rare, as new-builds are no longer permitted.
Restrictions for non-Swiss Residents
Several restrictions exist (Lex Koller) for non-residents wishing to purchase a ski apartment or chalet in Switzerland. In addition to the jurisdictional restrictions mentioned above, others include:
An annual quota of just 1,440 permits allowing foreigners to purchase property.
Purchase of only one property per foreign family (husband/wife and children).
Size restriction of 250m2 to the dwelling purchased.
A maximum of six months occupation of the ski apartment or chalet per year (by the family) with a maximum of three months per visit.
A restriction on annual rentals of the property.
It is also impossible to purchase a property in the name of a company that is not Swiss-owned.
Real Estate Transfer Tax
Real estate transfer tax differs in each canton and ranges from 0.2% to 3.3% of property value.
Registration fee (0.25% of property value) is paid to the Land Register Authority.
Notary fees vary from canton to canton. It is generally around 0.10% of property value.
Swiss banks will lend up to 70% of the purchase price. The loan is usually in the form of a current account overdraft secured on the property repayable over 25 years. Read our guide to mortgages in Switzerland for more information.
The estate agents fees vary from 3% - 5% between cantons plus an additional 7.6% for VAT.
If you propose to use mortgage funds from your resident country (i.e. outside of Switzerland) to buy your property, currency risk and fluctuation must be taken into account.
Property Ownership Taxes & Running Costs
An annual real estate tax is collected by each individual canton. The tax rate ranges from 0.05% and 0.3% and is based on the assessed value of the real estate, which is generally below the property's market price.
In addition to this tax, additional running costs include: utility bills, service charges associated with general maintenance.
Renting & Income Tax
Rental income in Switzerland is taxable at the federal, cantonal and municipal levels. Administration costs invoiced by third persons, necessary maintenance and improvement costs, as well as interest payments in respect of loans used to acquire income, are deductible from the taxable amount. The rates of the federal, cantonal and municipal income taxes are then applied. Since the cantonal and municipal income taxes are imposed on rental income, the total tax liability varies according to the location of the property.
Annual wealth taxes are levied at the cantonal level. Individuals pay taxes on enterprise assets and real estate situated in Switzerland. The tax payable varies from canton to canton. The assets are valued at their market value. Personal debts, mortgages, bank loans and overdrafts are deductible, as well as certain personal deductions and allowances from the taxable base, depending on the canton.
Capital Gains Tax
At the federal level, gains from the sale of private property are not taxable, and gains from the sale of business property are taxed as income. At the cantonal and municipal level, a real estate gains tax is imposed on the sale of both private and business property.
The rates for capital gains are usually progressive and the longer the property is owned, the lower the taxes. A shorter owning period would require a surcharge and both cantonal and municipal levels are applicable. The following are the cantonal rules for the disposal of immovable property:
The standard rate is applicable after the holding period of four to five years. The top burden usually ranges from 25% to 50%.
Tax is gradually reduced after exceeding the four to five years of ownership. The maximum relief allowed is 50% to 70% of the payable tax.
A surcharge of up to 50% of the normal tax may be imposed on short term gains i.e. properties sold within the first four or five years.
Inheritance tax is payable in Switzerland but is much lower than in the UK and most European countries. Inheritance tax is a cantonal tax and varies from one canton to another. In most cantons there is no tax between spouses and in Canton Valais (Verbier) there is zero inheritance tax if the property is willed to direct line descendants.
For property registered in multiple names, tax is paid on the share of the deceased only.
All properties in Switzerland are freehold and unless the purchaser becomes a Swiss resident the property will devolve in accordance with your wishes.
Canton: The individual ‘states’ of Switzerland. Lex Koller: Swiss Federal Law restricting the sale of property to no-Swiss nationals.