If you are moving to Switzerland or already live there, like many people you may want to own your own home to gain freedom from monthly rental challenges. In fact, there are many benefits homeowners in Switzerland enjoy apart from being able to claim ownership of their home. For starters, buying Swiss property is a good investment but you have to do it right.
If you have the misfortune of buying the wrong property, you can end up with a lot of financial hardship therefore it is important that you prepare adequately before you even start looking. Cosmos Values is a great source to consider with their expertise on what an aspiring Swiss homeowner should look for before making that purchase.
Factors to Consider
Renting in Switzerland can be very expensive. While owning your own home may be cheaper in the long run, there are a few factors that come into play such as mortgage qualifications. You must ensure that you have the needed requirements to qualify for a mortgage. There are some steep affordability rules that Swiss banks have for mortgage applicants. In addition, there are myriads of maintenance and administrative costs. If these costs are a little above what you can afford, you may be better off renting for a little longer so that you can prepare better. Owning a home under financial strain may end up being more of a challenge than a gain.
Property tax is also hinged on location. These taxes are not levied nationally but are rather the responsibility of municipalities and cantons. Consequently, you may pay more for a property in one canton and pay less for a similar property in another canton. In fact, you could even realize that homeowners in the neighboring canton pay almost nothing in terms of land tax. There are a few cantons which do not levy cantonal land taxes. The ones that charge expected payments from 0.5% to 2% of the property value annually.
Homes must be maintained regularly in order to remain liveable and attractive. Moreover, a rundown building is hardly expected to fetch a good price, therefore value can only be maintained or even improved with proper maintenance. Home buyers sometimes fail to factor in certain maintenance costs. If you are buying your home in Switzerland, you must take stock of the weather first. There is a reason why Switzerland is the perfect destination for skiing enthusiasts. The winters are freezing and regular maintenance to homes cannot be avoided.
You will therefore to consider the following:
- The materials of the home you are buying. Some materials are more affected than others.
- The design of the home. There are designs which are better able to withstand the freezing conditions of Swiss winters.
- The costs of heating.
Homes in Switzerland are built to withstand severe winters but they don’t come cheap. In order to cope with maintenance costs, you will need to set aside some funds every year to cover future renovations. The best plan is to set aside at least 0.3% of the property’s value. These funds are exempted from the costs of running the home.
Public transportation is a major consideration for property sales in Switzerland. How well is your properties location connected to the bus routes will be a major consideration in pricing the home. It is also a major factor to consider with regard to the future increase in value.
Potential for Long-Term Investment
The Swiss real estate market is strictly regulated which makes it a little slow in comparison to others. However, it has been consistent with good performance as a long-term investment. In order to get the best out of it, you must consider location. Buying a property which is close to popular business locations and resorts may cost a little more, but they will fetch a tidy sum should you decide to sell later. Properties in easy to reach areas are also good to invest in. Buyers should therefore consider proximity to major towns, cities and resorts as well as the commute. Opting for property in remote agricultural areas and former industrial ones will cost you less money but will not have the same signifigance regarding property value appreciation.