Buying property in Switzerland is a significant decision and whilst it can be a good investment, there is no one-size-fits-all answer as to whether or not to purchase property yourself.
That being said, the key factors that often influence this decision are:
- Owning property can provide stability and potential tax benefits, as mortgage interest payments and some maintenance costs can be tax-deductible.
- Swiss property prices are high, especially in urban areas, and the down payment requirement is typically 20% for most lenders, with a maximum of 10% of the down payment (half of the 20%) being allowed to come from your Pillar 2 assets.
- If you do not hold Swiss citizenship or residence, there may be limitations surrounding purchasing a property, particularly if it is to be used as a holiday home.
- If you expect to move within a few years, renting might be more flexible and cost-effective, as buying and selling property incurs significant transaction costs.
- Property is an illiquid asset, meaning you may not be able to access the funds when you need them. It could take over 6-months to sell your property.
- Historically, Switzerland has shown to have a stable property market with relatively low volatility compared to other countries.
- Should you leave Switzerland, there are strict rules around your ability to rent out property, so it is essential to check the rules of your canton to determine whether this will be an option.
You should speak with either a Mortgage Adviser, your Finance HQ Guide, or lender (bank) to look into this topic further.
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Please note that all content within this response has been prepared for information purposes only. This response does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.
