Buying a home in Switzerland: what you really need to know before you buy

Why only 36% of Swiss people own their own homes

Switzerland remains a country of tenants: around 60% of the population rents their home. 

Source: Crédit Agricole – NextBank

This figure can be attributed to the particularly strict conditions for home ownership compared with other countries.

The main obstacle is not just the cost of property, but the requirement for a deposit.
To buy your main residence, you must provide at least 20% of the purchase price.
There is a further major constraint: at least 10% of this deposit must come from your own liquid assets (savings, 3rd pillar, life insurance). The remaining 10% may come from your 2nd pillar (LPP). 

Without that start-up capital, the project is at a standstill, regardless of your income.

Rent vs monthly repayments: a misleading comparison

Comparing your current rent with your future monthly mortgage payment is a classic mistake. 

Although a monthly mortgage payment often seems lower than rent, it is only part of the equation. 

Becoming a homeowner brings with it new responsibilities:

• Maintenance costs: Allow for around 1% of the property’s value per year for renovations and day-to-day wear and tear.
• The notional rental value: This is a specific tax provision. The tax authorities add a notional income (the amount you would save by not paying rent) to your taxable income, which increases your tax bill.
• Purchase costs: Notary fees and land registry fees (around 5% of the purchase price in some cantons, such as Geneva) must be paid in cash and are not covered by the bank.

The real benefits of home ownership (asset accumulation, security, tax deductions)

Despite the challenges, becoming a homeowner is a powerful way to secure your future:

1. Freedom and security: You no longer face the risk of your tenancy being terminated.
   You can renovate your home as you wish (knock down a wall, repaint) and enjoy complete peace of mind.
   
2. Tax optimisation: In Switzerland, debt is tax-deductible. Your mortgage interest and maintenance costs reduce your taxable income.
   If you opt for indirect repayment (via a 3rd pillar pension plan), you can claim even greater tax relief whilst repaying your debt.
   
3. Building wealth: Instead of paying rent that’s money down the drain, you invest in property.
   Historically, Swiss property has appreciated in value, providing security for your retirement or a capital gain should you decide to sell.
   
4. Reducing costs in retirement: Paying off all or part of your mortgage before the end of your working life can drastically reduce your housing costs at a time when your income is falling.

Financing your purchase: mortgages, equity and Swiss regulations

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In Switzerland, getting a mortgage doesn’t depend solely on your salary. 

The system is based on a strict division between your savings and the bank loan, with calculation rules that may come as a surprise to non-residents.

The 20% equity: where can it come from?

It’s the essential ticket. 

To buy a main residence, you must provide at least 20% of the purchase price as a deposit.

The source of this money is strictly regulated:

• The mandatory “cash” requirement (minimum 10%): Half of your deposit must come from “actual” cash: bank savings, the sale of securities, an inheritance, a gift, or your third-pillar pension assets.

• The 2nd pillar (LPP): You can use your occupational pension savings to make up the remaining 10%.

• Additional costs: Please note that the 20% does not cover everything. 

You must pay the notary fees, stamp duty and land registry fees out of your own pocket. 

These costs (approx. 5% in Geneva) cannot be covered by the mortgage or the LPP.

First and second mortgages: how do they work?

Unlike other countries where the entire loan is repaid, Switzerland divides the mortgage into two parts known as “ranks”:

1. The first tranche (up to 67% of the price): This is the ‘perpetual’ portion.
   
   The bank does not require you to repay it. You only pay the interest. This allows you to maintain a tax-deductible debt against your income.
   
2. The second category (the remainder, approx. 13%): This is the depreciable portion. 

It must be repaid within 15 years or, at the latest, when you retire.

Useful information for non-residents 

If you hold a B permit, you may purchase your main residence without prior authorisation. For cross-border workers (G permit), you may purchase a second home without authorisation within the area of your place of work, but it may not be let out.

Is it a good idea to use your LPP or 3rd pillar savings to make a purchase?

Source: BCV brochure – Online Mortgage

Using your pension savings to finance your home is a strategic decision that offers two options:

• Early withdrawal: You use the money directly to pay for the purchase. This reduces your debt and your monthly interest payments, but it reduces your future pension benefits and triggers an immediate tax liability on the withdrawal.

• Pledging: Instead of withdrawing the money, you leave it in your pension account. It serves as security for the bank. 

The advantage? Your pension pot continues to grow, and you retain a higher level of debt, which maximises your tax deductions.

 The Geneva tip: If you’re buying property in the canton of Geneva, check whether you’re eligible for CASATAX. 

If the sale price does not exceed a certain threshold (around CHF 1.2 million), you can benefit from a significant reduction in registration fees (savings of over CHF 18,000) and a 50% reduction in mortgage registration fees.

Taxation for property owners: what you gain and what you pay

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In Switzerland, becoming a homeowner has a significant impact on your tax return. 

The system is based on a balance between notional taxable income and deductions that can significantly reduce your tax bill.

The notional rental value: the tax that tenants don’t pay

It is this Swiss peculiarity that often comes as a surprise: the rental value. 

The tax authorities consider that living in your own home provides you with a financial benefit equivalent to income.

• How does it work? An amount equivalent to what you would earn if you rented out your property (usually 60–70% of the market rent) is added to your taxable income.

• Reform on the horizon: A historic decision has been taken to abolish this tax from 1 January 2029. However, until then, you will remain subject to this rule for your main residence. Second homes, on the other hand, may continue to be subject to this system under the latest federal guidelines.

Tax-deductible expenses (mortgage interest, maintenance, renovation)

To offset the imputed rental value, the tax authorities allow you to deduct significant amounts. 

This is where you take back control of your budget:

1. Mortgage interest: You can deduct almost all the interest paid on your mortgage.
   Under the 2029 reforms, these deductions will be capped, but for now they remain a key tax-saving measure.
   
2. Maintenance and renovations: Work carried out to maintain the value of your property (painting, replacing a boiler, roof repairs) is 100% tax-deductible.
   
   Handy tip: For minor works, you can opt for the flat-rate deduction (often 10–20% of the rental value) without providing supporting documents. For major projects, opt for the actual costs.
   
3. Energy efficiency: Investments in installing solar panels or improving thermal insulation are particularly encouraged. They remain tax-deductible and often allow the cost to be spread over two consecutive tax years to maximise the impact.

If you’re planning major maintenance work, try to schedule it before 2029. 

Cross-border commuter: should you shop on the French side or the Swiss side?

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For a cross-border worker, choosing where to live is a strategic decision that affects both their quality of life and their long-term financial well-being. 

Between the convenience of living close to Switzerland and the purchasing power of the French property market, here are the key factors to help you decide.

The benefits of shopping in France when your salary is paid in CHF

Shopping in France whilst being paid in Swiss francs (CHF) offers an immediate, automatic advantage: increased purchasing power.

• Price per square metre: For the same budget, you get significantly more space (often a house with a garden where you would only get a flat in Switzerland).
• Financial assistance: When buying a property in France, you may be eligible for certain schemes such as the zero-interest loan (PTZ), which is not available for purchases in Switzerland.
• Cost of living: Apart from mortgage payments, ancillary costs (insurance, utilities, maintenance) are generally lower on the French side, which helps ensure you have more disposable income.

A loan in euros vs a loan in Swiss francs: the exchange rate risk over 20 years

This is the crux of the matter for anyone living across the border. The currency you choose for your mortgage will determine your exposure to exchange rate risk for the next twenty years.

1. A loan in euros (EUR): It’s a bet on the future. If the CHF strengthens against the euro, your monthly repayment will cost you ‘less’ in Swiss francs over time.
   On the other hand, if the euro rises, your repayment amount will increase.
   
2. A loan in foreign currency (CHF): This option eliminates the exchange rate risk on your monthly repayments. As you earn in CHF and repay in CHF, your repayment burden remains fixed relative to your salary. The downside is that the risk shifts when you sell the property. 

If you sell your property in euros to repay an outstanding balance in Swiss francs, a sharp rise in the value of the CHF could force you to put in more of your own money to clear your debt.

Border areas where to shop (Haute-Savoie, Ain, Pays de Gex)

The cross-border property market remains very buoyant in 2026, with distinct characteristics depending on the area:

• The Pays de Gex (Ain): Boosted by its proximity to CERN and international organisations, this is a safe haven for property investment. Towns such as Gex and Divonne-les-Bains remain highly sought-after despite prices having stabilised at a high level (around €350,000 for a high-quality two-bedroom flat).
• Haute-Savoie (Annemasse, Saint-Julien): Ideal for those who prefer to use public transport (Léman Express). It’s the efficient choice for keeping journey times to a minimum.
• Emerging areas: In search of a quieter environment and more space, cross-border commuters are now moving further afield to the Vallée Verte or towns such as Boëge, where value for money is better than in the areas immediately adjacent to the border.

The exchange rate: the unexpected factor in your property project

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If you earn your living in Swiss francs (CHF) but make purchases in euros (EUR), or vice versa, the exchange rate becomes a key factor in your transaction. 

To ignore its impact is to accept losing several thousand euros without even realising it.

Deposit, monthly payments, solicitor’s fees: 3 times when currency exchange can be costly

Buying a property involves a series of stages where the need for foreign currency is critical:

1. The transfer of the deposit: This is the largest single amount transferred at any one time. On a deposit of €100,000, a difference in fees of just 1% between two providers amounts to a difference of €1,000. That’s enough to cover part of your moving costs or the cost of your new household appliances.
   
2. Purchase costs (notary fees): Often mistakenly referred to as “notary fees”, these mainly comprise stamp duty and taxes payable to the State. These costs must be paid by bank transfer before the final deed is signed. An unfavourable exchange rate when converting these tens of thousands of euros unnecessarily increases the final bill.
   
3. Loan repayments: This is the ‘drip-by-drip’ effect. Over a 20-year mortgage, saving as little as €15 a month thanks to a fairer exchange rate adds up to a total saving of €3,600. It’s the easiest way to save money in the long term.

Points to bear in mind before signing

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Buying property in Switzerland is a marathon, not a sprint. 

Given the pressures of the market and long-term financial commitments, there are several factors that warrant particular attention to ensure your dream does not become a burden.

The scarcity of supply and pressure on prices

The Swiss market is characterised by a supply that is structurally lower than demand, particularly in urban centres (Geneva, Lausanne, Zurich).

The hidden costs of home ownership (service charges, renovations, insurance)

The selling price is just the tip of the iceberg. 

Homeownership involves recurring costs that tenants are unaware of:

• The renovation fund: If you are buying a flat under the PPE (Propriété Par Étage) scheme, you must make monthly contributions to a fund set aside for future building works (roof, lift, façade).
  
• Routine maintenance: The golden rule is to set aside 1% of the property’s value each year to cover repairs and natural wear and tear. For a property worth CHF 1,000,000, this amounts to CHF 10,000 per year.
• Insurance: Property insurance (compulsory in most cantons) and life/disability insurance (often required by the bank to cover the debt) will be added to your monthly expenses.

Interest rate risk: what happens if mortgage rates rise?

Most Swiss homebuyers opt for long-term fixed-rate mortgages (10 or 15 years) to protect themselves.

Source: BCV brochure – Online Mortgage

However, the risk of interest rate fluctuations remains a reality when it comes to renewing your loan:

The financial shock 

If your interest rate rises from 1.5% to 3.5% at the end of your fixed-term contract, your monthly repayment could double. 

It is crucial to calculate your borrowing capacity using a notional interest rate of 5% (as used by banks) to ensure that you will always be able to make your repayments, even in the event of a crisis.

The Saron Strategy

Some people opt for variable rates based on the SARON. 

It is often more cost-effective, but it requires sufficient financial strength to absorb sudden increases in the cost of borrowing.

Advice from our experts

Don’t let unexpected expenses eat into your budget. 

By optimising your currency exchange when paying your bills (if you live in two countries) or when building up your renovation savings, you’ll free up some financial flexibility to cope with any potential interest rate rises.

Where can I buy it and how do I go about it?

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Successfully completing a property project in Switzerland requires a systematic approach and a good understanding of the local market. 

Here are the resources and key steps to turn your dream into reality.

The best cities for investment in 2026

The Swiss market is not limited to Geneva. 

In 2026, several sectors stand out for their dynamism and growth potential:

• Zurich: The financial hub remains the most dynamic and international market, ideal for secure investment.
• Lausanne: A safe bet, bolstered by its university hub (EPFL, UNIL), which ensures a steady demand for rental properties.
• Neuchâtel & Fribourg: These cantons are gaining prominence thanks to more affordable entry prices than in the Lake Geneva region, offering attractive gross yields (around 4.2%).
• Valais (Sion, Martigny): A region experiencing rapid economic growth, boosted by improved rail links. Read our detailed analysis: Property: where to invest in Switzerland?

The complete 3-step purchasing process

In Switzerland, the process involves a series of strict steps to ensure the safety of the parties involved:

1. Preparation (Financing): Confirm your budget by calculating the 20% deposit and applying the 33% rule (your housing costs must not exceed one third of your gross income).
   
2. The offer and the contract: Once you have found a property, you sign a notarised contract of sale and usually pay a 10% deposit (held in escrow).
   
3. The deed of sale: This is the final stage, when the notary formalises the transfer of ownership and registers the property in the land register. See our step-by-step guide: How to buy a property in Switzerland?

Surround yourself with the right experts

Buying a property is a complex process that requires trusted partners:

At every stage involving a transfer of funds (deposit, balance of the purchase price, notary fees), don’t forget to plan ahead for your currency exchange needs. 

Our solutions allow you to pay these amounts in the currency of your choice, without incurring bank charges.

Frequently asked questions about buying property in Switzerland