Property Acquisition in Switzerland by Foreign Non-Residents: A Comprehensive Analysis

Switzerland’s real estate market commands global respect for stability and quality. Yet, foreign nationals who do not reside in the country encounter a carefully regulated system when attempting to purchase property. The primary legislation is the Federal Act on the Acquisition of Real Estate by Persons Abroad, or “Lex Koller.” This law prevents excessive foreign ownership and keeps the market accessible for Swiss residents. As a result, residential property purchases by non-residents are usually forbidden unless certain conditions are met.

An important exception is the allowance for holiday homes in recognized tourist regions, subject to both national and cantonal quotas. While it is possible for non-residents to obtain a mortgage in Switzerland, doing so involves strict requirements. Often, banks expect a substantial down payment or assets under management with Swiss institutions. Moreover, each canton has its own rules regarding property acquisition and tax obligations, so foreign buyers should understand the local nuances before committing.

The Swiss government’s commitment to preserving a home-focused property market is clear, and Lex Koller—introduced in 1983—reinforces this stance. Quotas for holiday homes, size restrictions, and geographical limitations underline the country’s protective approach. Potential investors should appreciate that such policies are unlikely to loosen drastically in the foreseeable future. Although direct ownership of residential property remains restricted, buying a holiday home in specific tourist areas is viable—albeit subject to numerous constraints.

Executive Summary

Switzerland’s goal of keeping homeownership primarily available to its residents shapes the entire legal environment. The existence of Lex Koller, along with quotas for holiday properties, has long underscored this objective. Foreign buyers, therefore, must adopt a strategic, long-term mindset. If the purchase is authorized, it generally revolves around recognized tourist locales. However, these opportunities still involve strict size and area limitations, as well as yearly permit caps. This measured permission reflects Swiss willingness to accept some foreign capital, particularly in tourism-driven zones, without compromising broader housing availability.

Introduction: Understanding Property Acquisition in Switzerland by Foreigners

Switzerland’s outstanding economic stability and high living standards draw investors worldwide. However, national authorities exercise tight control over foreign-owned property through a defined regulatory structure. This structure rests heavily on Lex Koller, dictating who can purchase real estate and under which circumstances.

Restrictions focus primarily on residential properties for those living abroad. By contrast, the law tends to be more accommodating for commercial real estate when used for legitimate business activities. In this report, you will discover how to navigate mortgage financing, follow purchase procedures, and grasp each step’s financial implications. Swiss real estate’s enduring stability, coupled with the government’s consistent enforcement of Lex Koller, offers both reassurance and a reminder that drastic deregulation is highly unlikely.

The Cornerstone of Regulation: Decoding Lex Koller

Enacted in 1983, Lex Koller remains Switzerland’s principal federal law for foreign property buyers. It seeks to curb extensive foreign land ownership and sustain housing that residents can readily access. Instead of listing who cannot purchase Swiss property, Lex Koller frames transactions requiring authorization for non-resident buyers if the intended use is residential and if the acquisition fits the law’s defined scope.

In March 2025, the Swiss Federal Council announced its intention to enhance restrictions for foreign property acquisitions through Lex Koller amendments. The proposed direction would impose stricter limitations, including:

• Shortening the time exemption for foreign residents buying a primary Swiss home
• Restricting commercial property acquisitions strictly to self-use
• Potentially requiring authorization for foreign buyers acquiring shares in Swiss-listed real estate companies

Such revisions, once enacted, could raise the scrutiny on future foreign property investments in Switzerland. Currently, direct purchases of residential real estate remain broadly disallowed unless specific permission is secured, while commercial properties may be more accessible if an economic benefit is demonstrated. Although the new legislative measures are still under development, they indicate the possibility of more stringent rules ahead.

General Observations on Lex Koller

Lex Koller extends across all cantons, but its implementation can differ from region to region. Areas popular with tourists (e.g., ski resorts) may already have well-established mechanisms to handle foreign applications, whereas major urban centers could have tighter constraints. The likely tightening of Lex Koller in 2025 means prospective buyers should remain current on legislative developments. Notably, foreign investment is welcomed if it bolsters the broader economy, which is why commercial purchases often enjoy more lenient terms.

Who Can Buy What and Where? Navigating Property Acquisition Rules

General Restrictions for Non-Residents

Generally, non-resident foreigners seeking to purchase Swiss residential property must first obtain special authorization. Yet, certain exceptions apply. EU/EFTA citizens living in Switzerland on a B or C permit can buy a primary residence without additional permissions, treated similarly to Swiss nationals. Non-EU/EFTA nationals with a valid C permit also gain this benefit. Importantly, purchasing property in Switzerland does not itself grant residency rights.

Non-resident foreigners cannot acquire Swiss residential property under a corporate name; instead, these transactions must be executed under the individual’s name (or adult family members). Buying real estate solely to develop and resell residential units is likewise off-limits for those living abroad. Swiss law thus creates a hierarchical system based on a buyer’s nationality and residency status, aiming to give preference to those with stronger ties to the country.

Cantonal Variations and Quotas

Although federal law anchors the overall rules, each of Switzerland’s 26 cantons interprets and enforces them somewhat differently. For instance, some cantons designate “tourist areas” where non-residents may purchase holiday homes, subject to size limits and regional constraints. A separate national quota of 1,500 holiday-home permits per year is then distributed among cantons.

Major cities, like Zurich and Geneva, do not allow non-residents to buy holiday homes. Meanwhile, rural or alpine regions such as Valais or Graubünden often have higher quotas, but each canton sets its own procedures. Adding to the complexity, Lex Weber (Second Homes Act) imposes restrictions on building new secondary residences in places already exceeding 20% of second homes. This dynamic interplay of laws and cantonal policies demands thorough research for any foreign buyer.

Table 1: Cantons Permitting Holiday Home Purchases by Foreign Non-Residents (Subject to Quotas and Restrictions)

Note: Quota information is based on available data from the provided snippets and may be subject to change.

Property Types Available to Non-Residents

Foreign non-residents who secure authorization are typically entitled to buy holiday homes in Swiss tourist areas. These can be chalets or apartments in scenic ski resorts. Size restrictions often limit net habitable space to 200 m², with land capped around 1,000 m². Some exceptions exist for slightly larger parcels if there is a demonstrable need. Certain cantons also allow non-residents to purchase units within serviced apartment buildings (aparthotels), again subject to approval.

By contrast, commercial property acquisition faces fewer hurdles. Foreign buyers can generally purchase hotels, office complexes, or industrial real estate without special permits if used for genuine business activities. However, obtaining real estate for pure capital investment or property trading might still require authorization. For new second-home construction in municipalities where second homes exceed 20% of local housing, building is largely prohibited for non-residents. These stipulations ensure that holiday residences mainly serve tourism while preventing them from becoming de facto primary homes.

Commercial Property Opportunities for Non-Residents

While residential real estate is heavily regulated by Lex Koller, non-residents face no direct restrictions on acquiring commercial property in Switzerland. This means foreign individuals and companies can purchase offices, retail spaces, hotels, and industrial facilities without needing special permits. Swiss authorities generally view such acquisitions as beneficial if they support genuine business operations, create jobs, or otherwise contribute to local economic growth.

Because commercial purchases do not fall under the same stringent rules as residential transactions, foreign investors may find it significantly easier to expand or diversify their portfolios with Swiss commercial real estate. However, it remains prudent for non-residents to consult legal and financial experts regarding any associated taxes, regulations, or zoning laws that vary by canton. Thorough due diligence ensures compliance with broader Swiss legislation and helps identify attractive market opportunities.

Property Price in Switzerland

The Swiss property market is characterized by robust online valuation tools and evolving market trends. Whether you’re buying or selling, understanding the key pricing metrics is essential. Below is an overview of property pricing in Switzerland as of March 2025, including detailed data by property type and by city.

Price per Square Meter (m²)

*Price ranges vary by location and property-specific factors.

Market Prices by Property Type

House Prices by Room Count

Apartment Prices by Room Count

Property Prices by City

In addition to national averages, property pricing can vary significantly from city to city. The following table presents average price per m² data for apartments and houses in key Swiss cities, along with their populations:

Additional Insights

Market Trends:
In the past 12 months, house prices increased by 1.4% and apartment prices by 2.2%. Over the long term (21 years), price per m² for houses increased by 82.0% and for apartments by 91.9%, reflecting the strong growth in the Swiss housing market.

Securing Financing: Mortgage Options for Non-Resident Foreigners

Eligibility Criteria and Requirements

Although Swiss banks do lend to foreigners, the terms can vary significantly based on residency. Those with B or C permits typically find the process simpler, while non-residents undergo more scrutiny. Applicants must show strong personal ties to Switzerland (family, regular visits, or part-time stays) and a robust financial profile. Traditional guidelines often require at least 20% down. However, many lenders have now tightened policies further, and some insist that non-resident clients contribute at least 40% of the acquisition value—a higher threshold that ensures substantial equity in the purchase.

When non-resident foreigners do meet the criteria, they should expect the lender to assess their capacity to cover all housing costs without exceeding one-third of gross annual income. Banks generally request proof of earnings spanning several years and sometimes factor in country-specific regulations, which can be especially relevant for U.S. citizens. A purely strong financial background may not be enough; institutions also want reassurance that the property aligns with permitted uses for non-residents—most often, a valid holiday home in an approved canton.

Exploring Swiss Banks and Financial Institutions

Several financial institution categories offer non-resident mortgages:

• Cantonal Banks: Regionally focused, with competitive options and in-depth local knowledge.
• Private Banks: Often cater to high-net-worth clients. Some private banks will provide up to 60% LTV if the borrower meets asset management requirements. In certain cases, private banks even offer mortgages with near-80% LTV if significant collateral is held, although that is less common today.
• Universal Banks: Large financial groups (e.g., UBS AG) with established international desks.

Establishing a banking relationship beforehand can dramatically improve your chances of approval. Also, keep in mind that each bank determines its own lending parameters. Private banks, for instance, frequently tie loan-to-value generosity to the amount of assets under management. Alternatively, more conservative banks may expect a larger down payment (beyond 40%) and rigorous evidence of Swiss connections.

Alternative Financing Approaches

For non-residents who struggle with conventional mortgages, AUM-based lending offers another path. By placing securities or liquid funds in a Swiss bank’s portfolio, you may unlock more favorable loan terms. In such scenarios, the bank views your managed assets as additional collateral, sometimes increasing the loan-to-value ratio closer to 80%—though that typically applies to high-value real estate.

These specialized arrangements often come with shorter terms, interest-only repayment structures, or specific AUM thresholds. Nonetheless, if you possess sizeable liquidity and want to avoid a large cash outlay, AUM-financed deals can be attractive. Keep in mind that these deals are less about standard mortgages and more about leveraging your broader wealth to secure property in Switzerland.

The Legal and Financial Pathway: Procedures for Purchase and Mortgage

Buying real estate as a foreign non-resident involves a multi-step process overseen by real estate agents, banks, and public notaries. Below is a concise roadmap:

1. Find a Property and Engage an Agent: Begin by pinpointing a location that allows foreign ownership of holiday homes. Work with a local agent who knows that region’s rules.
2. Secure Financing (Pre-qualification): Approach Swiss banks early to gauge your mortgage potential; for non-residents, demonstrating a legitimate reason for buying is critical.
3. Make an Offer: If you locate a suitable property, submit an offer through your agent.
4. Sign a Reservation Contract (Preliminary Agreement): Once accepted, sign a binding preliminary agreement (Vorverkaufsvertrag) and pay a deposit (usually up to 10%) held in escrow.
5. Appoint a Notary: In Switzerland, the notary serves as an impartial legal figure for both parties, handling official documentation.
6. Apply for Foreign Buyer’s Permit (If Required): If Lex Koller applies—such as a holiday home in a tourist area—the notary assists with the authorization application.
7. Obtain Mortgage Approval: Submit all needed documents to finalize the mortgage. Bear in mind the bank’s stricter demands on non-residents.
8. Sign the Deed of Sale (Kaufvertrag): Once your permit (if required) and loan are in place, finalize the deal at the notary’s office. Pay remaining costs and fees.
9. Register the Property: The notary records the new ownership in the local land register, legally transferring title.
10. Mortgage Registration: If applicable, the mortgage is also filed with the register.

Notaries are pivotal in Swiss property deals, ensuring valid, transparent transactions. If a foreign buyer’s permit is needed, that application typically extends the timeline by a few weeks.

Essential Resources and Guidance

Navigating Swiss real estate as a foreign non-resident requires precise information and professional support. Cantonal authorities can inform you about local regulations, holiday-home quotas, and procedural specifics. Skilled Swiss property lawyers help interpret Lex Koller, structure contracts, and confirm compliance. Reputable real estate agencies streamline the property search and handle administrative duties, especially for international clients.

Meanwhile, you can also consult:

• Land Registry (Grundbuchamt) for property rights, liens, or encumbrances
• Swiss Federal Office for Migration regarding residency permits
• Swiss Federal Tax Administration for guidance on transaction fees and tax obligations
• Swiss Notaries Association to understand the notary’s role

Local expertise is vital, especially given each canton’s distinct rules. Building a team of trusted advisors—agent, lawyer, and banker—can mitigate unforeseen obstacles and ensure a smoother closing.

The Financial Landscape: Tax Implications and Additional Costs

Purchasing Swiss real estate entails more than the purchase price. Cantonal differences significantly affect fees and taxes. Common expenses include:

1. Notary Fees: Cover drafting and registering the deed of sale; typically 0.2%–1% (sometimes 2.5%–3.5%) of the property’s value, depending on the canton.
2. Land Registry Fees: Often 0.25%–0.5% of the purchase price.
3. Property Transfer Tax: Known as stamp duty in certain jurisdictions, it ranges from 1%–3.3% or higher, though Zurich imposes no such tax. Certain places, like Vaud, can charge up to 5%.
4. Legal Fees: If you hire a private lawyer in addition to the notary, expenses may be about 1% of the purchase price.
5. Mortgage Registration Fees: Calculated on a sliding scale. For instance, Valais starts at 1% for loans up to CHF 200,000.

Ongoing Taxes for Property Owners

• Annual Property Tax: Many cantons levy this at varying rates (e.g., 0.015% in Valais/Bern, 0.010% in Vaud). Zurich does not levy such a tax.
• Annual Wealth Tax: Based on net worth (including Swiss property); relevant mostly to Swiss residents or partial residents.
• Income Tax on Notional Rent: Even if a property is not rented, owners pay tax on an estimated rental value (Eigenmietwert). Actual rental income is taxable as well.
• Capital Gains Tax: Levied on profit made when selling; rates depend on how long the property was held and the gain amount.
• Inheritance and Gift Tax: Varies by canton; some places have abolished it or reduced it for spouses/descendants.

Double taxation treaties exist between Switzerland and various other countries, preventing owners from being taxed twice on the same income. Typically, buyers shoulder all the transaction fees. Because these levies differ by canton, thorough research ensures you budget accurately.

Table 2: Estimated Property Purchase Costs by Canton (Examples)

Note: These are approximate figures and can vary based on the specific property and transaction details. It is recommended to consult with local professionals for precise cost estimations.

Conclusion: Key Considerations for Foreign Property Buyers in Switzerland

Ultimately, non-resident foreigners face Lex Koller as the main statute regulating Swiss real estate purchases. While it generally bars buying residential property, allowances exist for holiday homes within designated areas, subject to strict quotas and size limits. It is indeed possible for non-residents to arrange Swiss mortgages, but lenders often demand significant deposits or proof of assets managed by Swiss banks. In practice, many non-resident clients now encounter an expectation of 40% down on holiday or second homes, though certain private banks may finance up to 60% loan-to-value if your overall financial profile meets their standards.

Because each canton implements rules differently—and charges its own combination of taxes and fees—potential buyers must conduct thorough, location-specific research. To handle the complexities effectively, it is advisable to seek professional legal and financial guidance from experts who know Swiss property laws and local regulations. Reputable real estate agencies experienced with international buyers can offer added support.

Commercial property is typically much simpler to obtain, as there are no direct restrictions on foreign ownership. If your goal is to invest in offices, hotels, retail, or industrial assets, Switzerland offers a clear path to purchase without the need for additional authorization.

While Swiss real estate remains appealing to foreign investors, the process is complex: strict prerequisites, steep down payments, and careful navigation of regional legislation can be challenging. However, with well-structured planning, a vetted team of advisors, and a firm grasp of the relevant cantonal rules, foreign non-residents can acquire Swiss property successfully.

For tailored guidance and a smoother experience, consider partnering with Mamytova Consulting, a leading firm well-versed in Swiss legal frameworks and financial procedures for international investors. With proper research, expert advice, and meticulous preparation, you can navigate Switzerland’s distinctive property market and enjoy owning a holiday residence or commercial asset in one of Europe’s most stable economic environments.