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  #21  
Old 31.10.2015, 11:43
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Re: Investment idea

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No one pays 2500 chf for a 650k flat

For that price, the flats in Zug are closer to 1,5m CHF
In Zug. Exactly.

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In Geneva to get 2500 CHF of a crappy property you will have to pay around 1.2 to 1.4M, maybe a bit less.

In Bern Fribourg etc (middle of nowhere in Switzerland) 650k property will get you 1500-1600 CHF a month, roughly speaking. Maybe even 1300-1400.
Look around. See my post, above. The best opportunities won't just present themselves.

Or don't, fine by me -- less competition for me!

By the way, as a rule of thumb, returns diminish with increasing purchase price. Rental yields are generally best on lower-priced real estate. A million-franc apartment will not provide double the rent of one purchased for CHF 500k.
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  #22  
Old 31.10.2015, 13:51
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Re: Investment idea

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In Zug. Exactly.


Look around. See my post, above. The best opportunities won't just present themselves.

Or don't, fine by me -- less competition for me!

By the way, as a rule of thumb, returns diminish with increasing purchase price. Rental yields are generally best on lower-priced real estate. A million-franc apartment will not provide double the rent of one purchased for CHF 500k.
If you want to bother with 500k apartments, fine by me, I don't even want to be seen in one, yet alone buy or rent one

Whether or not they give better returns on your money, what about location and future appreciation? The 1M apartment which is in a nice neighbourhood, even if prices fall, your money will be way safer there than in the 500k apartment in a crappy neighbourhood, no view etc. When it comes to renting and times are though, which one will rent easier? Say prices fell and price is same. Who will even look at your apartment?

Real estate is lazy investment and I don't like it. That said, I have an apartment in Geneva and I am waiting on my C permit to buy a house. Not for the investment but as a cheaper than rent living. All my other money I put them into other stuff where I can get way more than the unimaginable 7% return.

Be careful buying crappy properties in Switzerland, everybody wants the nicer once, hence the price!
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  #23  
Old 31.10.2015, 13:55
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Re: Investment idea

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If you want to bother with 500k apartments, fine by me, I don't even want to be seen in one, yet alone buy or rent one

Whether or not they give better returns on your money, what about location and future appreciation? The 1M apartment which is in a nice neighbourhood, even if prices fall, your money will be way safer there than in the 500k apartment in a crappy neighbourhood, no view etc. When it comes to renting and times are though, which one will rent easier? Say prices fell and price is same. Who will even look at your apartment?

Real estate is lazy investment and I don't like it. That said, I have an apartment in Geneva and I am waiting on my C permit to buy a house. Not for the investment but as a cheaper than rent living. All my other money I put them into other stuff where I can get way more than the unimaginable 7% return.

Be careful buying crappy properties in Switzerland, everybody wants the nicer once, hence the price!
you don't need a C permit to buy a house.
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Old 31.10.2015, 13:57
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Re: Investment idea

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In Geneva to get 2500 CHF of a crappy property you will have to pay around 1.2 to 1.4M, maybe a bit less.

In Bern Fribourg etc (middle of nowhere in Switzerland) 650k property will get you 1500-1600 CHF a month, roughly speaking. Maybe even 1300-1400.
Only a fool would buy a property for 1.2 million, requiring a 240k deposit if you can rent it for 2500 a month. I guess people will never learn.

I remember buying property in London for 100 months rent, today that only just covers the deposit & buying costs. This won't end well.
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Old 31.10.2015, 14:10
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Re: Investment idea

I find it difficult when people ask about investment ideas when they don't mention their time horizon, expected min return and risk acceptance.
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  #26  
Old 31.10.2015, 14:30
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Re: Investment idea

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you don't need a C permit to buy a house.
When you have B permit you are limited to 1 property only, if you want to buy more you need to have a C permit
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Old 31.10.2015, 14:32
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Re: Investment idea

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Only a fool would buy a property for 1.2 million, requiring a 240k deposit if you can rent it for 2500 a month. I guess people will never learn.

I remember buying property in London for 100 months rent, today that only just covers the deposit & buying costs. This won't end well.
Of course, but people need to live somewhere! Families, kids, people need stability and a place to call home, so people will always need apartments or houses.

Long long term buying is always cheaper than renting and most people don't know what to do with their money anyway!
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  #28  
Old 31.10.2015, 14:57
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Re: Investment idea

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When you have B permit you are limited to 1 property only, if you want to buy more you need to have a C permit
....unless you are citizen from UE/EFTA states.
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  #29  
Old 31.10.2015, 15:45
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Re: Investment idea

anyway, for a rental property you need 40% down, no pension fund.
I can't see the OP doing that with 200,000f.
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Old 31.10.2015, 15:48
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Re: Investment idea

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anyway, for a rental property you need 40% down, no pension fund.
I can't see the OP doing that with 200,000f.
Depends where you get your loan from. You can also get 100% residential mortgages in CH, no pension fund, although the rates aren't quite as good as those offered elsewhere. Again, it pays to look around.
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  #31  
Old 31.10.2015, 15:49
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Re: Investment idea

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Long long term buying is always cheaper than renting and most people don't know what to do with their money anyway!
That's completely untrue, your clearly quite young to have such an opinion. Swiss mortgage rates were 9% whilst I was paying 17% in the Uk. Renting was hugely cheaper at the time.

The question is will interest rates exceed 15% in my lifetime, quite possibly is my view.
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  #32  
Old 31.10.2015, 16:10
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Re: Investment idea

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Depends where you get your loan from. You can also get 100% residential mortgages in CH, no pension fund, although the rates aren't quite as good as those offered elsewhere. Again, it pays to look around.
Sure. However this very much depends on your personal situation and how much money you already have. The more you have, the more the banks are ready to lend.

I don't know much about the OPs financial situation. But my guess is he isn't one of the candidates to recieve all these special services from banks.

But what do I know. Maybe he only wants investment advice for a small portion of his fortune.
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Old 31.10.2015, 16:12
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Re: Investment idea

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anyway, for a rental property you need 40% down, no pension fund.
I can't see the OP doing that with 200,000f.
Not strictly true, a lot depends on your personnel circumstances, with no track record, the banks can ask up to 50%, with a record, 20% is usually sufficient, but everybody is different.

I buy up studios, 2 bed apartments, you can find these in Riviera for around $300-400k, if you know where to look.

There is ALWAYS a market for this size, students, kids taking a first apartment, divorcee's, this list is long and very easy to rent. The advantage of having several small properties, in my opinion is one maybe empty for a month or so, but the others are occupied so money keep coming in. With 1 large property, if it's empty, it's empty and no revenue, just costs.

To give an example, i have a property on the Riviera, with notary fees it cost less than Chf 300k, i have a gross rent of Chf 1'350.--, mortgage is less than Chf 200k at less than 1% per year, lets say about Chf 150 per month, management fees, maintenance etc, Chf 400.-- per month, my back pocket Chf 800.-- per month for an investment of Chf 100k, or if you prefer 8%

Not counting the capital appreciation of the property.
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  #34  
Old 31.10.2015, 16:20
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Re: Investment idea

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That's completely untrue, your clearly quite young to have such an opinion. Swiss mortgage rates were 9% whilst I was paying 17% in the Uk. Renting was hugely cheaper at the time.

The question is will interest rates exceed 15% in my lifetime, quite possibly is my view.
Not for mortgages in Switzerland, they are capped at 15%.........by law in the constitution via a vote a long time ago.

15%...........not a hope in hell, govts already have problems with debt at 0%, just think how the debt repayments would balloon out of size, even with a modest interest rise. No govt can afford an interest rise for foreseeable future, so unless you are immortal, i just can see it happening FMF
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Old 31.10.2015, 16:24
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Re: Investment idea

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Not for mortgages in Switzerland, they are capped at 15%.........by law in the constitution via a vote a long time ago.

15%...........not a hope in hell, govts already have problems with debt at 0%, just think how the debt repayments would balloon out of size, even with a modest interest rise. No govt can afford an interest rise for foreseeable future, so unless you are immortal, i just can see it happening FMF
Well plenty of governments with high credit ratings have defaulted in the past, Germany immediately springs to mind, so the inability to pay does not mean it can't happen. Rather like removing the CHF / Euro peg........ It seemed unlikely to many people when in fact it was obvious it would eventually be dropped.
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  #36  
Old 31.10.2015, 16:50
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Re: Investment idea

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Not strictly true, a lot depends on your personnel circumstances, with no track record, the banks can ask up to 50%, with a record, 20% is usually sufficient, but everybody is different.

I buy up studios, 2 bed apartments, you can find these in Riviera for around $300-400k, if you know where to look.

There is ALWAYS a market for this size, students, kids taking a first apartment, divorcee's, this list is long and very easy to rent. The advantage of having several small properties, in my opinion is one maybe empty for a month or so, but the others are occupied so money keep coming in. With 1 large property, if it's empty, it's empty and no revenue, just costs.

To give an example, i have a property on the Riviera, with notary fees it cost less than Chf 300k, i have a gross rent of Chf 1'350.--, mortgage is less than Chf 200k at less than 1% per year, lets say about Chf 150 per month, management fees, maintenance etc, Chf 400.-- per month, my back pocket Chf 800.-- per month for an investment of Chf 100k, or if you prefer 8%

Not counting the capital appreciation of the property.
Where on The riviera are You finding these properties ? I'm looking now for a decent 2 bed and they are not these prices.

PS see my next message on the topic re: personal circumstances.
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Old 31.10.2015, 17:07
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Re: Investment idea

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Where on The riviera are You finding these properties ? I'm looking now for a decent 2 bed and they are not these prices.

PS see my next message on the topic re: personal circumstances.
You used the word 'decent', which could be your issue.
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  #38  
Old 31.10.2015, 17:50
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Re: Investment idea

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You used the word 'decent', which could be your issue.
300 is a studio, 2 bed from 450 and up.
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  #39  
Old 31.10.2015, 19:17
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Re: Investment idea

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300 is a studio, 2 bed from 450 and up.
'Decent'? In Geneva? Yeah, right. And I have a bridge you could buy.

Last edited by miniMia; 01.11.2015 at 02:00. Reason: Buy, not by!
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Old 31.10.2015, 22:39
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Re: Investment idea

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Well plenty of governments with high credit ratings have defaulted in the past, Germany immediately springs to mind, so the inability to pay does not mean it can't happen. Rather like removing the CHF / Euro peg........ It seemed unlikely to many people when in fact it was obvious it would eventually be dropped.
I think the crash of Swissair was enough excitement for the Swiss, unlikely they will default on anything else i feel.
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