If you plan to buy another property, you can avoid taxes on selling the apartment by rolling over any gains into the base cost of the new property (subject to certain conditions).

Before you bank on such a strategy, check with your lender whether they accept that you have sufficient financial capacity to take on 2 mortgages...

Finding a house is difficult. I was searching for the past 4 years and saw only 2 houses that I made an offer on. The first I made a full offer immediately on the day it was put on the market only to get delaying tactics until it was confirmed sold to another party. The second I bought last year.

You don't want your ideal home to come up only to lose it because you can't get further financing or need to wait to sell your existing place.

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We are also planning to use this strategy in ZH, though. Currently the prices for single family and multi family house are out of whack!. I hope that market cools down a bit in the next 5 - 10 years, and we can afford a house by either selling our apartment or getting a second mortgage.

As Switzerland is very much a rental market, when I buy property, I am not thinking whether it can be sold if I need to, but if I can rent it out.

So my first property was on a relatively busy street (so it wasn't expensive to buy), but also 3 minutes walk from the train station (many would want to rent it, even if many won't buy it). Bought it in 2003 and sold it 10 years later at double the price. Got very very lucky here.

Bought the second property with the same thought, i.e., can I rent it out?


I would have loved to rent out my first property but Raiffeisen didn't let me. They forced me to sell it. They simply didn't allow their customers the benefit of rental income. Some banks do so you need to check that.

In selling the first property, the problem I had wasn't about finding the buyer, it was that I had no idea how much I could sell it for, and thus budgeting for the second house was difficult. But I could discuss with the potential buyer when they want to finalize the deal - in my case, they didn't really want to move in until 8 months later which gave us plenty of time. And as someone mentioned before, your CGT is simply deferred.

Not sure why Raiffeisen wouldn't want to let you buy to rent? There must be another reason as they are my main bankers and were happy to lend to rent. They even set up the deposit guarantee accounts for my tenants so it's not a question of me trying to pull the wool over their eyes, and not that i would!

Raiffeisen is a collection of small individual banks that sail under a common flag, usually one commune (or small region) is its own individual bank. Some business practices are the same all over, but others may easily differ from one location (commune) to another.

damn that would have been a nice Theme for my thesis.

We bought with the idea of selling, not renting, i.e. if we need to leave CH, can we easily sell. If you go inland from the lake here prices go down significantly but selling can take a long time.

Simple. They calculate only with 35% of the potential rental income and thus it wasn't enough to cover the additional interest I would have to pay. This despite the fact that the full rental would have been additional income that I don't need at all other than to pay the mortgage. UBS and ZKB would have taken up to 80% of the amount or possibly more depending on the situation, but I was stuck with Raiffeisen because of the long term fixed morgage with huge cancellation penalties.


I think of renting - if it is good enough to rent out, then it should not be too difficult to sell if I have to. Actually the point here is that I think "defensively", and not thinking of it as an investment to make capital gains.

In my opinion, if you have the means and you plan to stay in CH, buy something. The interest rates are really low at the moment.



Also, unless you are planning to buy 3M+ the competition is high on good places and it will likely take you some time to find at place, so you'll probably have the opportunity to see how COVID shakes out

I had a strange experience with the property purchase. As I mentioned in one of my earlier posts, we are in the initial stages of buying a 4.5 room apartment in Basel Land area.

We saw an apartment, liked it and made an offer for the listed price. The agent took the offer and sat on it for almost 3 weeks and has come back today saying that the apartment has been sold off to another buyer. No mention on what the other offer was or any other details.

When I asked as to whether I could make a counter-offer, he declined saying that there is no renegotiation.

Is this normal for the purchase process? I would have thought that there would be at least an opportunity to make a counter offer, especially as we had offered the list price.

Also, any advice on how I can avoid this experience in the future? Thanks.

Exactly the same happened to me.

How to avoid:

1. Be the first to offer
2. Offer more than asking conditional on response within x hours and taking property off the market
3. Become a more attractive buyer

There's a lot of discussion about this process on this related thread: https://www.englishforum.ch/housing-...en-viewed.html

Now I've seen it all:

Thanks Phil, those are solid tips. Can you please elaborate on point no. 3, i.e. becoming a more attractive buyer.

Some of my colleagues have advised me to create a marketing brochure filled with glossy photographs of my family (emphasising children) and mentioning that both of us work at multinationals.

Also, and I'm not even sure if that is or should be a factor, make the searches and correspondence in my wife's name. I'm skeptical of this, but if that's what it takes to get a foothold, then so be it.

From the other thread:
https://www.englishforum.ch/3185359-post117.html

https://www.englishforum.ch/3185785-post132.html

The concept of supply/demand and market forces don't resonate with many Swiss. In any other market you would be confident that being the highest bidder would be enough. When I first moved here (2016) I lived in Horgen and there was a building full of new-build apartments that had just gone on sale. I went to see them and they had a strange layout and were overpriced for what they offered. Here we are in 2020 and they remain mostly empty. I bumped into the agent (last year) who is marketing them and asked her why the seller doesn't lower prices to attract buyers.....and was met with a blank stare......

The return on a new property yields around 7% these days. I find that return way too low for taking the risk of a 80% mortgage. Think about it: 7% return with 4 times leverage. ( 200k down payment, 800k mortgage, 2200 NET rent per month)

The interest rate can only go up from here and the price of real estate can only go down. This is fundamental economics.

If you have the money just go ahead and buy the house of your dreams. With a much smaller mortgage or no mortgage at all there is no risk involved because you won’t have to sell in a crisis. And that’s beautiful. If you have to sell in a down market or because you loose your job it will ruin your life. Maybe you worked 10-15 years in Switzerland earning a good salary and now you will loose it all. It is simply not worth the risk.

Remember, this is true for companies and for individuals as well: almost every financial blow-up is because of leverage.

I can relate to that and I would rather invest in real estate elsewhere with strong CHF earned here. It seems to me that it makes more sense to buy a place to live in but from investment prospective, I would use the money for other options e.g. stock market, pension and some portion for savings to have a cash available any moment.

I love the idea of real estate but being bound by 80% of mortgage in strong currency sounds like a bit too risky gamble to me. And if the property market goes south, as history shows it can, then I wouldn’t wanna be on the receiving side of it.

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Thanks. On further reflection, we behaved naively and were taken advantage of/exposed for that naivete. We will be more street-smart in the future.

The agency in question is ridoma ag. Advise high caution when proceeding ahead with them, especially with regards to transparency and openness.