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  #21  
Old 06.08.2007, 10:14
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Re: Residential and Commercial property investment in Switzerland

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You have to put down at least 20% on each property you buy - they won't let you use the existing properties to guarantee the new acquisitions like they do in the UK
This is an interesting comment. If your property in the banks eyes has free equity in then you can use this equity to release funds to secure a new property. I know this is not quite the same as in the UK but the principle is and the result is much cleaner than in the UK, if and when there are times of not being able to meet repayments - ie you do not have complex chains of security that need to be restructured. It also means you can have multiple lenders easily which is not necessarily the case in the UK if you have multiple properties secured against each other...
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Old 10.08.2007, 11:53
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Re: Residential and Commercial property investment in Switzerland

I agree about the leverage, and owning being a good deal. I would like to add that I think the 20% deposit is negotiable (downwards) in Switzerland, more so than Germany, where larger deposits are needed. Tax and transaction fees in Germany are very high. Notary fees can be wicked. On some fabulous former GDR properties, yields can be 30% of purchase price, but with no funding available for non residents, they only manage to match the leveraged properties for yield.
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  #23  
Old 10.08.2007, 12:11
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Re: Residential and Commercial property investment in Switzerland

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I agree about the leverage, and owning being a good deal. I would like to add that I think the 20% deposit is negotiable (downwards) in Switzerland, more so than Germany, where larger deposits are needed. Tax and transaction fees in Germany are very high. Notary fees can be wicked. On some fabulous former GDR properties, yields can be 30% of purchase price, but with no funding available for non residents, they only manage to match the leveraged properties for yield.
I think you are a bit out of date for Germany... I have a 10% deposit as a standard in Germany negotiated with my Bank there and can also use German property as security against other property as long as the securing property is commercially viable ie there is a net yield... As far as transaction fees are concerned I pay 1.5% of the sale price and tax is on the profit only which makes it again relatively interesting. Notary fees can indeed be high as they are percentage of transaction fee but then again you can use a notary in Basel Stadt which works out MUCH cheaper
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  #24  
Old 10.08.2007, 13:45
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Re: Residential and Commercial property investment in Switzerland

Richard,
What is the principle of using a BS notary for a German property purchase and it being cheaper than a German one.
Would the same principle apply within CH? i.e. could one use a BS notary for a ZH transaction?
Thanks in advance.
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Old 10.08.2007, 15:34
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Re: Residential and Commercial property investment in Switzerland

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Richard,
What is the principle of using a BS notary for a German property purchase and it being cheaper than a German one.
Would the same principle apply within CH? i.e. could one use a BS notary for a ZH transaction?
Thanks in advance.
Basel Stadt has an exemption and has had for as long as I know allowing them to notarise German transactions/documents. The German system is very simple, they charge a percentage of the value of the transaction variable by the work they are needing to do. If your transaction value is 20 Mio and the percentage is 2% then the bill comes in at 400K - for signing a freeking document... Hence all the big transactions are notarised in Basel where the fees are fixed lets say SFr. 500 for the same job - small difference. Unlike the Swiss system the German system does not recognise locality hence as long as the ability of the Swiss notar is deemed to be of the same standard or higher than the German notar then there is no problem having the Swiss notar notarize the documents - in theory this should apply for all self employed notars as Switzerland has a federal standards for self employed notars and therefore what applies to Basel should apply to AG, BE, BS, FR, GE, NE, JU, TI, UR, VD, VS. Note that there is no distinction made between BS and BL but there is between AI and AR! I guess you should have expected that...

As for notarising property purchases in Zürich I am 99% sure that you can NOT do it. In theory a notary public is an extension of the government and as such this is one of the jobs that a non-Swiss still cannot do, even a C permit holder (stand Jan 07). Extend that further and the government defines activities that are federal and others that are cantonal. According to Art. 55 ZGB the canton is responsible for the legal status of anything in its territory. As a house is in its territory the law and all that surrounding the law ie notars recognize locality. To this end only a local and since about 2 years this means canton (Exception waadt I think) notar can deal with house purchases.

Being an extension of the government various cantons have this position deferred to them by the gemeinde/canton or even through election. I am not sure of the limitations of every part of their work but for example for business transactions this is fairly unrestricted. Note also that most cantons allow self-employed notaries. Aargau is a good example of this. These being self employed can thus charge what they like for some work and for this reason many contracts from Zurich are notarized by Aargauische notary publics - other work is charged according to a price table...
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Old 12.08.2007, 02:45
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Re: Residential and Commercial property investment in Switzerland

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We have B permits (EU) which has meant that we have bought an appartment block in Zurich and we have to live in this building if we want to rent the other appartments out. We cannot buy anymore properties in Zurich until the law changes (been told anything between 2 years and never) or when we get a C permit - or that may be full residence.
Hope this helps
Does this still apply? Does it only apply to Kanton Zurich, or Zurich city only? I am thinking about something locally in Aargau. Are things different if the property has a commercial ground floor?

I knew that something like this was once the case, but understood that EU passport holders did not have this problem now? I was speaking to a bank 6 months ago, and they were quoting me two interest rates, one if I lived in the property, another if I didn't. They knew I had a B permit...
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  #27  
Old 17.08.2007, 15:16
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Re: Residential and Commercial property investment in Switzerland

Unless you are an Israeli Pension Fund Broker/Mafia Don/Despotic leader of other countries - forget it! Tax on rental income is 50% and when you sell it can be as high as 80%.....
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  #28  
Old 03.09.2007, 08:39
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Re: Residential and Commercial property investment in Switzerland

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I think you are a bit out of date for Germany... I have a 10% deposit as a standard in Germany negotiated with my Bank there and can also use German property as security against other property as long as the securing property is commercially viable ie there is a net yield... As far as transaction fees are concerned I pay 1.5% of the sale price and tax is on the profit only which makes it again relatively interesting. Notary fees can indeed be high as they are percentage of transaction fee but then again you can use a notary in Basel Stadt which works out MUCH cheaper
The Basel Stadt tip sounds fantastic, Thanks. All my experience of borrowing (or lack of!) has been on property in the former GDR (Berlin and surrounds). The banks were/are still extremely inflexible towards me. My experience has actually been quite recent, and friends still in the UK say it is getting worse from their viewpoint, all over Germany. I'm obviosly missing something...
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  #29  
Old 19.12.2010, 13:43
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Re: Residential and Commercial property investment in Switzerland

I have a M CHF 125 portfolio of commercial buidings and prime location plots for sale in the Lake Geneva area area, and clearly B permit holders will encounter much less trouble greenlighting-wise dealing with commercial property rather than residential.


The 'con' here is that banks require 50% in cash and not just 20%.


B.
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  #30  
Old 13.06.2011, 01:36
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Re: Residential and Commercial property investment in Switzerland

Greetings - help neeeded please - to revive this thread...........if one , as a foreginer, and no res permit B or otherwise.....already owns a residential property , can one also buy a commercial proerty? I thought from the info below that one could but the agent in Bern canton is saying no - please clarify - thanks

http://www.eiu.com/index.asp?layout=...el+Latest&rf=0

"Restrictions against foreigners owning commercial property were removed in 1997, as were barriers to owning domestic companies. As a result of liberalisation, there also has been a surge in investment in Swiss real estate. Restrictions still remain on ownership of residential property, but the government has proposed lifting all federal regulations restricting foreign ownership of residential properties. 2009"
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  #31  
Old 13.06.2011, 02:19
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Re: Residential and Commercial property investment in Switzerland

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Greetings - help neeeded please - to revive this thread...........if one , as a foreginer, and no res permit B or otherwise.....already owns a residential property , can one also buy a commercial proerty? I thought from the info below that one could but the agent in Bern canton is saying no - please clarify - thanks

http://www.eiu.com/index.asp?layout=...el+Latest&rf=0

"Restrictions against foreigners owning commercial property were removed in 1997, as were barriers to owning domestic companies. As a result of liberalisation, there also has been a surge in investment in Swiss real estate. Restrictions still remain on ownership of residential property, but the government has proposed lifting all federal regulations restricting foreign ownership of residential properties. 2009"
interesting question and i've been given conflicting information on this: 3 different answers from 2 people. the answers being:

- an EU b permit holder cannot buy or rent property
- the same guy then changed his mind and said an EU B holder can buy and rent property
- another guy said that you can buy property to live in and rent it out provided you live in the same building complex (restriction lifted if you a C permit holder)

would be good to get an official view as i don't have confidence in the changing answers i get!
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  #32  
Old 13.06.2011, 12:30
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Re: Residential and Commercial property investment in Switzerland

I think investment in property in Switzerland will give you very little return on investment. Safe but little!
I would say that the only way you are going to make money on property in Switzerland is if you buy it, live in it as your residence and refurbish it yourself (doing the works yourself as you will make nothing when you employ Swiss labour and stick to all the regulations) and then sell it. Even the timing can be crucial as the tax on the profit goes down on the length of time you have owned the property.
The other reason that you need to buy it in your own name is that if it is a commercial venture the banks will only give you a 50% loan on value; whilst if you do it as yourself you can get an 80% mortgage and use your pillar 2 pension as collateral.

My conclusion is that you can probably earn more with a day job and no risk in Switzerland.
The Swiss are generally Risk-Free and insure for everything.
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  #33  
Old 13.06.2011, 15:51
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Re: Residential and Commercial property investment in Switzerland

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I think investment in property in Switzerland will give you very little return on investment. Safe but little!
I would say that the only way you are going to make money on property in Switzerland is if you buy it, live in it as your residence and refurbish it yourself (doing the works yourself as you will make nothing when you employ Swiss labour and stick to all the regulations) and then sell it. Even the timing can be crucial as the tax on the profit goes down on the length of time you have owned the property.
The other reason that you need to buy it in your own name is that if it is a commercial venture the banks will only give you a 50% loan on value; whilst if you do it as yourself you can get an 80% mortgage and use your pillar 2 pension as collateral.

My conclusion is that you can probably earn more with a day job and no risk in Switzerland.
The Swiss are generally Risk-Free and insure for everything.

Do not forget the punitive capital gains taxes on residential property unless you use the money to buy another property; 60% tax in Zürich in first year on 100, 000 profit.
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  #34  
Old 13.06.2011, 22:02
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Re: Residential and Commercial property investment in Switzerland

I personally know of at least 4 people who look for international investors
and have been offering for the past 10 years 10 percent return on Real Estate in Zurich. Some of them started with literally hardly any money and are now multi millionaires just from the commission and managing fees, also do i know some of there clients which are really happy with them.

The only problem thy are having at the moment is there is no worth while houses to be bought and the market is dry so thy are just sitting on literally hundreds of millions of dollars and desperate to buy...

So don't let anyone put you off and say its not worth it in Switzerland, do you homework properly and take us all our of a beet in 10 years time...
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  #35  
Old 15.06.2011, 13:44
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Re: Residential and Commercial property investment in Switzerland

The Swiss Market is two fold as far as I understand. You have residential properties and leisure properties. Normal residential properties usually have a smaller upside than holiday properties in the alps.
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  #36  
Old 11.05.2012, 09:46
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Re: Residential and Commercial property investment in Switzerland

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I wondered if anyone here had experience of buying and owning property investments here. I already own an own occupied apartment, but I would like to buy another couple for investment. Are there any restrictions on B permit holders buying? Also, where is the market place for Swiss commercial property to be found?

I have quite a bit of experience in UK and German property investment so am not a novice, but I have found it very difficult to find listings here - Homegate has a few multi-family houses but no commercial for example - it feels like I am just not looking in the right places?
------------------------------------

Hi everyone. I am thinking of buying a property to let (as an investment). I am both British and Swiss. Where do I gain more financial benefit? in UK or Switzerland?!! I am very confused with cons and pros, specially with tax related issues .....

Thank you
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  #37  
Old 11.05.2012, 11:22
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Re: Residential and Commercial property investment in Switzerland

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------------------------------------

Hi everyone. I am thinking of buying a property to let (as an investment). I am both British and Swiss. Where do I gain more financial benefit? in UK or Switzerland?!! I am very confused with cons and pros, specially with tax related issues .....

Thank you
Probably most important of all is what currency your capital is now and what you want it to be in when you realise your investment...

Thus if you are in francs and invest in the UK, returns may seem higher and your francs will buy more. But what will that investment be worth 20 years down the line? 20 years ago there were CHF3.20 to £1. Today your looking at CHF1.48. A loss of more than 50%...
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  #38  
Old 11.05.2012, 13:57
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Re: Residential and Commercial property investment in Switzerland

Excellent point. To put it another way, compared to 20 years ago the £ was worth over 100% against the franc.

Additionally there's the tax situation, the Grundstückgewinnsteuer on selling and yearly Eigenmietwert taxes means you need to hold on to an investment 20 years just to benefit from an exit tax reduction of 50%.

There are other less onerous investment options treated more favorably both during the lifetime of the investment and at the end of the cycle from a tax perspective.

Not to mention the changing landscape in terms of getting funding compared to the buy to let culture in the uk given its lack of building.
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Old 12.05.2012, 12:08
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Re: Residential and Commercial property investment in Switzerland

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Probably most important of all is what currency your capital is now and what you want it to be in when you realise your investment...

Thus if you are in francs and invest in the UK, returns may seem higher and your francs will buy more. But what will that investment be worth 20 years down the line? 20 years ago there were CHF3.20 to £1. Today your looking at CHF1.48. A loss of more than 50%...
dear AbFab: Thanks for your excellent point of currency issue.
1. my thoughts are on long-term and I wont be "converting currency" in the end.
2. I dont have a great capital - i already own a big house in Switzerland
3. I am relying on a local-bank ( british or Swiss) to lend me their local mortgage
4. the net-monthly-rental-income is the most I`m looking forward to it

Do I make sense?!
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Old 12.05.2012, 13:05
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Re: Residential and Commercial property investment in Switzerland

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dear AbFab: Thanks for your excellent point of currency issue.
1. my thoughts are on long-term and I wont be "converting currency" in the end.
Well if you invest in the UK and live out your days in Switzerland or visa versa (which seem unlikely as you already have a property here), then you will be converting you income and eventually your capital if you sell up in the UK

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2. I dont have a great capital - i already own a big house in Switzerland
In that case you will need a large mortgage, and I would suggest you would be safer borrowing in your country of residence. In fact it is unlikely that you can borrow in any other way.

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3. I am relying on a local-bank ( british or Swiss) to lend me their local mortgage
See above, you'll need to be a resident to borrow.

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4. the net-monthly-rental-income is the most I`m looking forward to it
Don't forget the agro of dealing with tenants! Presumably you don't want to live a building where you rent out apartments, but want (a) separate property(ies). This could turn out to be more than just a part-time job.

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Do I make sense?!
Mmmm I have to say there may be easier ways of long-term investing. That said many now do it both in the UK and here...
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