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Old 11.01.2012, 10:46
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Apartment buying - need help to understand - english citizen

I'm working in Switzerland 2 and a half years

I'm considering buying an apartment here now rather then always renting - currently for example I live in a 55m2 apartment and pay 1000CHF a month

-

My manager also was advising me to buy rather then renting

-

I found an apartment in my same town which is 90m2

Purchase Price = 180'000

Mortgage costs starting at = 195chf/month

-

My manager informed me that I should look at my "2nd Pillar" and from there, there would be an amount of money which I can take for an aprtment

How much & do they usually ask for if you want to buy?

What other info do I need to compile to show?

I don't even know how much is in my 2nd Pillar, how can I find out?

Thank you!

Just for info, I earn around 90k a year (CHF)
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Old 11.01.2012, 11:02
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Re: Apartment buying - need help to understand - english citizen

all been answered before, many times

your annual pension statement will give you the information about how much you have.

you'll need 20% (ish) deposit in either cash or your pension

Make an appointment at a bank with a mortgage consultant they will go through all your options.
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Old 11.01.2012, 11:06
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Re: Apartment buying - need help to understand - english citizen

also be aware that different lenders will require different amounts in deposit and that your pension (2b) cannot be the whole deposit

you need to talk to a lender as blue says. Start with your bank.
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Old 11.01.2012, 11:33
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Re: Apartment buying - need help to understand - english citizen

Quote:
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I'm working in Switzerland 2 and a half years

I'm considering buying an apartment here now rather then always renting - currently for example I live in a 55m2 apartment and pay 1000CHF a month

-

My manager also was advising me to buy rather then renting

-

I found an apartment in my same town which is 90m2

Purchase Price = 180'000

Mortgage costs starting at = 195chf/month

-

My manager informed me that I should look at my "2nd Pillar" and from there, there would be an amount of money which I can take for an aprtment

How much & do they usually ask for if you want to buy?

What other info do I need to compile to show?

I don't even know how much is in my 2nd Pillar, how can I find out?

Thank you!

Just for info, I earn around 90k a year (CHF)

You get a piece of paper (well, I do, don't know about you) every year that shows how much money is in your pension fund.

How much cash do you have?
I don't even know if banks will lend you that "little" money - and if the 20% rule even applies to such small loans. They might want more - or send you to consumer-credit straight away....
Based on the 20%-rule, you would need 36k cash - if you want to tap the 2nd pillar, does that mean you were unable to save 36k in 36 months?
Given you only pay 1000/month rent, where does the money go?
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Old 11.01.2012, 11:35
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Re: Apartment buying - need help to understand - english citizen

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Given you only pay 1000/month rent, where does the money go?

DJ mixing desks
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Old 12.01.2012, 10:52
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Re: Apartment buying - need help to understand - english citizen

The amount you have in your 2nd Pillar which you are allowed to use to put down on a mortgage, can this also be taken out and used for a property abroad like in UK or only in Switzerland?

Thanks
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Old 12.01.2012, 10:54
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Re: Apartment buying - need help to understand - english citizen

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The amount you have in your 2nd Pillar which you are allowed to use to put down on a mortgage, can this also be taken out and used for a property abroad like in UK or only in Switzerland?

Thanks
Only in Switzerland.*
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Old 12.01.2012, 10:55
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Re: Apartment buying - need help to understand - english citizen

Only Switzerland, and only for your primary residence.

Tom
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Old 12.01.2012, 10:58
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Re: Apartment buying - need help to understand - english citizen

It can be used only towards purchase or paydown of mortgage on your primary residence - and therein is a caveat. If you use 2nd pillar (either withdrawal or pledge) you are tied to that property - you cannot simply move away and rent it out at will, without reimbursing pillar 2 or removing the pledge - at least that's the rules. If you leave switzerland and return to UK to live, you can in theory do the same for a property over there, but in practice I think it is not so easy as it involves cooperation of UK bank/bs, solicitors and swiss authorities....
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Old 12.01.2012, 12:27
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Re: Apartment buying - need help to understand - english citizen

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I found an apartment in my same town which is 90m2

Purchase Price = 180'000

Mortgage costs starting at = 195chf/month
A 90m2 flat for only 180'000?

Are you sure you have the correct number of zeros?
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Old 12.01.2012, 12:30
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Re: Apartment buying - need help to understand - english citizen

Perhaps it was only the deposit amount.
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Old 12.01.2012, 12:34
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Re: Apartment buying - need help to understand - english citizen

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A 90m2 flat for only 180'000?

Are you sure you have the correct number of zeros?
I guess it is this here:

http://www.comparis.ch/immobilien/ma...spx?id=5957054

See the term "Baurecht"?

It basically means that you don't own the land.
Not necessarily a bad thing - but you should be aware of the implications this has on the resale value....

One should be really careful acquiring property in a foreign country with a different language....


See here:
http://www.beobachter.ch/wohnen/eige...unlich-billig/

Last edited by rainer_d; 12.01.2012 at 12:35. Reason: added link
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Old 12.01.2012, 12:36
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Re: Apartment buying - need help to understand - english citizen

Baurecht is Leasehold.

http://en.wikipedia.org/wiki/Leasehold_estate

http://www.investorwords.com/2751/leasehold.html
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Old 12.01.2012, 12:37
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Re: Apartment buying - need help to understand - english citizen

180k for an apartment? That's a good price.

I was paying 1900 a month for a 60m2 near Lausanne center and I think the same would have costed 500k? Or maybe even more.

Where is this appartment that you are searching for, far away from the city, is it old appartment needing lots of repairs or it's just a normal price for Biel/Bienne?
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Old 12.01.2012, 12:52
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Re: Apartment buying - need help to understand - english citizen

OK, so it's a leasehold. I've read on wikipedia, so basically apart from paying mortgage on the 180k purchase price for the apartment you need to pay mostly rent for the land to the land lord who sold you and built the building?

And it seems you can never buy out the land from the owner, but pay each month even to the persons who will inherit the land?

How much do you have to pay per month for the land lease? Considering that a similar apartment can be at least 800-900k maybe it's not a bad deal at all?
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Old 12.01.2012, 12:55
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Re: Apartment buying - need help to understand - english citizen

leasehold on apartments is the norm in the uk, so I don't think that would put off a brit

just make sure you check all the implications very carefully here
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Old 12.01.2012, 14:30
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Re: Apartment buying - need help to understand - english citizen

Make sure the lease is for a good long time, and check under what circumstances the rent can increase.

For 2nd pillar funding, you still need 10% cash. At least, we did in BL.
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