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  #81  
Old 08.01.2011, 17:27
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Re: Explanation for the Swiss Housing System?

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...and because they have some money on the side they have to reinvest it...and maybe squander it on a silly idea?
Also, because of their free time, they've probably spent more money on products than the average household...which means, that they contributed to the UK economy.

Karl, my work affects your life directly more than your work affects my life.
Your "work" appears to me to be a full time job posting a lot of negativity on this forum.
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  #82  
Old 08.01.2011, 20:07
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Re: Explanation for the Swiss Housing System?

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....
Acutally, if anyone has a link to stats about home-ownership vs. renting in different countries I'd be interested to see it, because I'd venture to guess in most countries (besides US/UK) the majority of the populatiuon own their own homes. I still think CH is an exception where the majority rents. And I'm still having trouble understanding why exactly.

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Most European countries support home ownership and the social housing sector is declining, the researchers found. Home ownership is highest in Ireland (81%) and lowest in Germany (47%) against a European average of 69%. ...
Quote from this EU page that also includes more info: http://ec.europa.eu/research/social-sciences/projects/036_en.html
referring to this study: http://www.iccr-international.org/impact/summary.html

Evidently Switzerland was part of the study.

In relation to that it probably it is interesting to have this on the side:
http://epp.eurostat.ec.europa.eu/cac...-10-555-EN.PDF
http://www.ubs.com/1/e/wealthmanagem...n_figures.html

And if you really wanna dig further: http://www.oup.com/us/catalog/genera...=9780199543946

If you want for the rest of the world, try google or any of the UN organization web-pages.

Last edited by Piafia; 08.01.2011 at 20:19. Reason: adding a link:-)
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  #83  
Old 08.01.2011, 20:43
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Re: Explanation for the Swiss Housing System?

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This post reminds my of my neighbours in the UK some 25 years ago. The both had elderly parents and no siblings.

With the death of the her parents, they inherited their home, sold it, paid off their mortgage on their own house, put cash in the bank and the wife stopped working and bought a couple of dogs.

A couple of years later the same thing happened to his parents and they now had a couple of hundred 1000 in the bank. So at just over 40 he didn't see the point of getting up early and coming home late each day and he quit his job too.

They have lived for the last 25 years on the gains of the UK property market. Not actually contributing anything to the UK economy, other than as consumers - then of mainly imported goods...
Good for them, ain't capitalism grand.
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Old 08.01.2011, 20:45
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Re: Explanation for the Swiss Housing System?

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By working, producing goods and services, and paying income tax and national insurance...
Not everyone that works actually produces something.
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  #85  
Old 08.01.2011, 21:01
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Re: Explanation for the Swiss Housing System?

Prices are much much cheaper in some areas of Switzerland. Up here in the NE Jura, prices are very low compared to the UK, and mortgage rates are extremely low too. If you are prepared to move away from large towns and Lakes - there are some real bargains to be had, with very reasonable commuting times- by road or public transport.

BTW just come back from visiting daughter + sil/bil in Surrey! Prices there are just incredible - saw a house bought for 2 mio squids to be pulled down and replaced by ONE new family home!

Last edited by Odile; 08.01.2011 at 22:11. Reason: +info
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Old 08.01.2011, 21:09
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Re: Explanation for the Swiss Housing System?

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Instead of trying to analyze why the Swiss housing market is different or inferior to the US/UK one, why not ask why the US/UK housing market is a good model in the first place and why should it be emulated here? What has basically happened in the US/UK in the past 50 years is that instead of creating valuable goods that can be sold on the global market for profit, both countries have allowed their manufacturing to collapse, and have outsourced it China/India/Mexico. Instead, both countries have generated income by artificially inflating house prices and selling them to each other at ever increasing prices, and then pretending that the higher price is "profit" created by doing absolutely nothing. People then borrowed against the pumped up price to buy things (cars, TVs, consumer goods) that are now almost exclusively made abroad. People also made the mistake of thinking their retirement savings was in their house, and therefore saved very little on the side. It was all a Ponzi scheme, and the housing crash that the UK/US is now experiencing is a painful reminder of fallacy of the whole concept. Many people in both countries are now in precarious financial situations due to the "buy now, it will only go up" mentality.

Meanwhile, in Switzerland, housing prices have remained high, but relatively stable, house-flipping is suppressed by clever tax policy, and the country has a healthy manufacturing base that creates valuable things and services that the world market buys. People save for their retirements by mandatory pension contribution, and the social security system is viable. And most people rent.

So, which system is working here?
Depends on what canton you live in, some have more liberal selling policies
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  #87  
Old 08.01.2011, 21:49
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Re: Explanation for the Swiss Housing System?

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Depends on what canton you live in, some have more liberal selling policies
Your posts and avatar somehow make sense together.
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  #88  
Old 08.01.2011, 21:55
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Re: Explanation for the Swiss Housing System?

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Instead of trying to analyze why the Swiss housing market is different or inferior to the US/UK one, why not ask why the US/UK housing market is a good model in the first place and why should it be emulated here? What has basically happened in the US/UK in the past 50 years is that instead of creating valuable goods that can be sold on the global market for profit, both countries have allowed their manufacturing to collapse, and have outsourced it China/India/Mexico. Instead, both countries have generated income by artificially inflating house prices and selling them to each other at ever increasing prices, and then pretending that the higher price is "profit" created by doing absolutely nothing. People then borrowed against the pumped up price to buy things (cars, TVs, consumer goods) that are now almost exclusively made abroad. People also made the mistake of thinking their retirement savings was in their house, and therefore saved very little on the side. It was all a Ponzi scheme, and the housing crash that the UK/US is now experiencing is a painful reminder of fallacy of the whole concept. Many people in both countries are now in precarious financial situations due to the "buy now, it will only go up" mentality.

Meanwhile, in Switzerland, housing prices have remained high, but relatively stable, house-flipping is suppressed by clever tax policy, and the country has a healthy manufacturing base that creates valuable things and services that the world market buys. People save for their retirements by mandatory pension contribution, and the social security system is viable. And most people rent.

So, which system is working here?
I totaly agree. Even though I can't bear the thought of renting all my life.

The US/UK/NZ/Aus (?) system of investing in housing is flawed when no retirement savings are made. It is a disgrace that a housing market is able to be turned into a speculative investment as it transfers wealth away from the youth towards the older generation. I'm thinking the baby boomers have had it pretty good already, what with the free education and the cheap housing and the Defined Benefit pensions.

I think a middle road between the "though shall not pay the mortgage off ever" and the "flipping housing" models can be sustainable. Perhaps with greater curbs on multiple home ownership (eg 50% tax on capital gains on properties one is not resident in) or a high rent tax such as being introduced in NZ. (4m people, rubbish incomes, shedloads of land, yet $1m USD + properties in Auckland? whaa?)

I haven't thought these measures through by the way, but investment into housing just like into wheat and other essential commodities is something that should be tightly controlled by government.
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  #89  
Old 08.01.2011, 22:12
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Re: Explanation for the Swiss Housing System?

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Prices are much much cheaper in some areas of Switzerland. Up here in the NE Jura, prices are very low compared to the UK, and mortgage rates are extremely low too. If you are prepared to move away from large towns and Lakes - there are some real bargains to be had, with very reasonable commuting times- by road or public transport.
I'm prepared to move - but my job isn't.
I live where my job is.
That said, if I only had to commute in one day per week, I'd probably live somewhere nice and cheap.
My work doesn't require any physical presence, but my boss likes to see the people around.
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  #90  
Old 08.01.2011, 22:13
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Re: Explanation for the Swiss Housing System?

OP If you dont like the system vote with your feet

I cant speak for the rest of the world but in the UK the "short hold tenancy agreement" is totally inadequate when comparing against the rental contract in CH. House prices in the UK are just as unaffordable as here if you compare Zurich to London and factor in wages etc.

I live here because of high home prices in the UK relative to wages. In the hope of moving back with some saving to help me some day.

check
housepricecrash.co.uk/ and
www.pricedout.org.uk/
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  #91  
Old 08.01.2011, 22:29
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Re: Explanation for the Swiss Housing System?

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No one buys a house [in the US] intending to pass it on to his/her children or to live in it, honestly, beyond an average of 7 years.
Completely agree!

Come around to mine sometime in Basel.. I will proudly show you my wife's GRANDFATHERS name still under the doorbell. I like the stories from the father-inlaw about where his father hung his police revolver on the hat 'stand' in the hall (which I use.. to hang my laptop).

And as for construction, this place will likely survive another world war.

CK
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  #92  
Old 10.01.2011, 14:43
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Re: Explanation for the Swiss Housing System?

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Not everyone that works actually produces something.
Those people are the first to be laid off.
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  #93  
Old 04.04.2011, 15:33
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Re: Explanation for the Swiss Housing System?

I don't see the point in owning a house when you retire, it just doesn't make sense, who needs all that space and expense.

It might make sense when you have kids at home, but I've never wanted to own one, and now that my kids are grown and (hopefully) will soon leave the nest, I really don't see the need for more than a couple rooms.

Tom


The general idea in the UK is (was!) that you pay off your house and then you leave it to your children.. quite a nice idea I think..
Here is seems to be the opposite, leave a massive debt..!
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  #94  
Old 04.04.2011, 15:40
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Re: Explanation for the Swiss Housing System?

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I don't see the point in owning a house when you retire, it just doesn't make sense, who needs all that space and expense.

It might make sense when you have kids at home, but I've never wanted to own one, and now that my kids are grown and (hopefully) will soon leave the nest, I really don't see the need for more than a couple rooms.

Tom


The general idea in the UK is (was!) that you pay off your house and then you leave it to your children.. quite a nice idea I think..
Here is seems to be the opposite, leave a massive debt..!
The concept of home ownership is a ploy by the banks to take away your cash, replace it by a massive debt that you'll never pay off in your life, and furthermore make you spend many a weekend fixing stuff when you could be having quality time with your family.

No thanks, not for me.
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Old 04.04.2011, 15:43
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Re: Explanation for the Swiss Housing System?

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The general idea in the UK is (was!) that you pay off your house and then you leave it to your children.. quite a nice idea I think..
Here is seems to be the opposite, leave a massive debt..!
You can't leave 'debt' to your children here (well, you can, but they aren't obliged to accept it).

Tom
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Old 04.04.2011, 15:50
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Re: Explanation for the Swiss Housing System?

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The general idea in the UK is (was!) that you pay off your house and then you leave it to your children.. quite a nice idea I think..
Here is seems to be the opposite, leave a massive debt..!
The idea is certainly to be able to pay-off a good part of the debt nevertheless.
Supposedly, the kids can either rent it out or sell it (rising prices for land have in the past made up for any losses from deprecation).

But rising energy-costs have made buying/owning an "old" house somewhat risky. And renovating an old house to bring it up to latest standards is expensive.

Certainly, if you sell a house, you will get some money back.
Paying rent OTOH, the money is gone.

The question is, does it make sense (instead of rent, you pay interest to the bank)?
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Old 04.04.2011, 16:07
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Re: Explanation for the Swiss Housing System?

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The question is, does it make sense (instead of rent, you pay interest to the bank)?
It's not really rent you pay to the bank as you can't call the bank when something needs fixing. Well you can, but they only repsond by selling you more debt. Basically, the bank takes the money but you keep the risk. If you rent, you are basically paying somebody else to absorb the risk.

Home ownership only makes sense if the value of the property increases at a rate that is well above inflation, and above what you could be making if you invested that money elsewhere. That may have been the case in the 1980 and 1990s but there is no saying that things will keep on that way.

Banks convincing you of a mortgage will often show you a graph of how your value develops over 25 years with renting compared to buying. That graph is flawed because it omits the fact that you are putting in your own cash as well as the bank's cash, and that the graph assumes that you would otherwise be storing that cash in your mattress, ie, not earning any returns.
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  #98  
Old 04.04.2011, 16:22
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Re: Explanation for the Swiss Housing System?

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It's not really rent you pay to the bank as you can't call the bank when something needs fixing. Well you can, but they only repsond by selling you more debt. Basically, the bank takes the money but you keep the risk. If you rent, you are basically paying somebody else to absorb the risk.

Home ownership only makes sense if the value of the property increases at a rate that is well above inflation, and above what you could be making if you invested that money elsewhere. That may have been the case in the 1980 and 1990s but there is no saying that things will keep on that way.

Banks convincing you of a mortgage will often show you a graph of how your value develops over 25 years with renting compared to buying. That graph is flawed because it omits the fact that you are putting in your own cash as well as the bank's cash, and that the graph assumes that you would otherwise be storing that cash in your mattress, ie, not earning any returns.
To be fair, though, it isn't that cut and dry. We wouldn't be able to afford to rent the size house we have - assuming you can find one.

Our (or rather then bank's!) house costs less to rent in mortgage payments than our old 5.5 flat. That doesn't take into account the tax breaks we'll have for paying mortgage payments.

Sure there's going to be times that we'll have to stump up to repair something, but to be honest we always had to pay an excess to have things repaired in our rented flat too.

You can make any assumptions of how your money could be earning more, but to be honest I've been shafted by the recent economic crisis and currency fluctuations too often. I'm happy to have a house I can live in for now...
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  #99  
Old 04.04.2011, 16:35
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Re: Explanation for the Swiss Housing System?

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You can make any assumptions of how your money could be earning more, but to be honest I've been shafted by the recent economic crisis and currency fluctuations too often. I'm happy to have a house I can live in for now...
It's a question of perspective I suppose. I've done quite well on the recent crisis because I've put my money into shares after their value dropped and sold after they recovered. With my savings tied up in property and the bank not letting me get at it that quickly, it wouldn't have been that easy.
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Old 04.04.2011, 16:53
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Re: Explanation for the Swiss Housing System?

Nowadays, around 50% of new build in the ZH and GE area are for sale not rent - and at prices that make my eyes water. I often pick up those free property brochures, and I just can't believe those prices. As the OP says, any 4 bed detached house with a small garden is 1m5 and very much upwards.
One thing I am surprised about though- is that people in the UK are prepared to have long commutes to get at better properties, schools, amenities, etc- but here they expect to be 30 mins max from work. People in the UK have long been creative, working partly from home, using the Internet, Videoconferencing, etc. Also I knew many families where the main earner was away from home a few days a week at the office in London or Birmingham, wherever- again in order to live in a much better property, environment, etc. There are many areas where property is very reasonable with lots of space, garden, a field or 2 for keeping animals, grow veg and fruit- in the most amazing countryside, and with great local schools. The Riviera by Lake Leman will have no more building land by 2014, and Switzerland by 2040, according to official predictions- so house ownership will not be encouraged as it takes too much space. We've made our choice, and it was easy as we are retired. We live out in the sticks and have a house and land that would cost an absolute fortune elsewhere. Horses for courses - you just need to 'think outside the box' and there are some amazing bargains out there- but probably not where you are looking

Last edited by Odile; 05.04.2011 at 11:54.
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