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Old 17.08.2012, 11:39
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Buying a house with permit B

Hi all,

I am a holder of permit B (EU country in my case).

Taking the lower interest/Swiss perpetuity mortgage system and my high rent, I have decided to buy a house in Switzerland. I realize that I must live in this house (B permit constraints).

Can anyone let me know what happens if after one year living in the house I own, I decide to move from Zurich to Geneve? Do I need to sell the house or can I just rent it (i.e then I would rent/buy a house in Geneve)

Thanks
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Old 17.08.2012, 11:43
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Re: Buying a house with permit B

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Hi all,

I am a holder of permit B (EU country in my case).

Taking the lower interest/Swiss perpetuity mortgage system and my high rent, I have decided to buy a house in Switzerland. I realize that I must live in this house (B permit constraints).

Can anyone let me know what happens if after one year living in the house I own, I decide to move from Zurich to Geneve? Do I need to sell the house or can I just rent it (i.e then I would rent/buy a house in Geneve)

Thanks
Are you using any pension fund money? If so that has to be repaid before you can rent regardless of permit. The bank will also require a far larger deposit for a rental property ca 40% IIRC.
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Old 20.08.2012, 17:59
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Re: Buying a house with permit B

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Hi all,

I am a holder of permit B (EU country in my case).

Taking the lower interest/Swiss perpetuity mortgage system and my high rent, I have decided to buy a house in Switzerland. I realize that I must live in this house (B permit constraints).

Can anyone let me know what happens if after one year living in the house I own, I decide to move from Zurich to Geneve? Do I need to sell the house or can I just rent it (i.e then I would rent/buy a house in Geneve)

Thanks
I will have owned my house for 5 years this December...I bought it as a holder of a B permit..I bought it cash with no mortgage. I`ve been informed that unless I keep it for at least 5 years I will be hammered with tax on any profit I make..
If you sell your house after just one year I`m sure you will be "stung" tax wise...I don`t think it`s a problem if you rent it out and live elsewhere, although I`m not sure..
Good luck.
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Old 20.08.2012, 18:37
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Re: Buying a house with permit B

Another thing to consider - when you sign the purchase contract (in front of the notary), they will ask if you are buying for personal use or for rental. If you say that you are planning to rent the place, you'll be hit with 8% sales tax on the purchase. If you are buying for personal use, there is no VAT cost.
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Old 20.08.2012, 20:45
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Re: Buying a house with permit B

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I will have owned my house for 5 years this December...I bought it as a holder of a B permit..I bought it cash with no mortgage. I`ve been informed that unless I keep it for at least 5 years I will be hammered with tax on any profit I make..
If you sell your house after just one year I`m sure you will be "stung" tax wise...I don`t think it`s a problem if you rent it out and live elsewhere, although I`m not sure..
Good luck.
CGT on houses can be for upto 25 years, making money on real estate is not encouraged here. Your also taxed on the benefit in kind of living there so you will pay tax on rent you don't pay.
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Old 20.08.2012, 21:00
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Re: Buying a house with permit B

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I will have owned my house for 5 years this December...I bought it as a holder of a B permit..I bought it cash with no mortgage. I`ve been informed that unless I keep it for at least 5 years I will be hammered with tax on any profit I make..
If you sell your house after just one year I`m sure you will be "stung" tax wise...I don`t think it`s a problem if you rent it out and live elsewhere, although I`m not sure..
Good luck.
unless the tax is greater than the profit from sale, i would be happy to be able to sell and get my money back from swiss property!
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Old 20.08.2012, 21:02
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Re: Buying a house with permit B

It must be considered as a very long term project. Sometimes it takes 1 or 2 years to sell a house! Imagine moving to another country and owning a house here that you can't sell? Invest your savings in Pharma & Swatch shares.
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Old 20.08.2012, 21:23
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Re: Buying a house with permit B

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Taking the lower interest/Swiss perpetuity mortgage system and my high rent, I have decided to buy a house in Switzerland.
Given that purchasing here is a long term project, did you take into account medium-to-long term interest rates for your purchasing? 5y is more 4.5% /yr than the current 1.5%..

Also, if you have a mortgage and sell before the end of term, you must reimburse the bank for the due interests covering the FULL contract period (5y, 10y). A neighbor of mine lost ~100K this way - he was sent to the US and wasn't allowed to keep the property.
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Old 20.08.2012, 21:49
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Re: Buying a house with permit B

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CGT on houses can be for upto 25 years, making money on real estate is not encouraged here. Your also taxed on the benefit in kind of living there so you will pay tax on rent you don't pay.

correct, completely opposite of the Anglo Saxon model which encourages real estate speculation. I guess the tax you mentioned is like property tax one pays in the US or Canada.
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Old 28.08.2012, 22:27
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Re: Buying a house with permit B

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Another thing to consider - when you sign the purchase contract (in front of the notary), they will ask if you are buying for personal use or for rental. If you say that you are planning to rent the place, you'll be hit with 8% sales tax on the purchase. If you are buying for personal use, there is no VAT cost.
Thank you James, Are you sure about this? Vat (7.6)%) changes the whole calculation in case i decide to go for investment ..
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