The advantages of owning a property in Switzerland
Switzerland enjoys a unique geographical position at the heart of Europe and borders France, Italy, Austria, Liechtenstein and Germany. It is not in the European Union and therefore has its own currency in the Swiss franc. It is however part of EFTA (the European Free Trade Association), along with Iceland, Liechtenstein and Norway. It has also been part of the Schengen zone since 2008.
The country is renowned for its economic stability, low taxation and private banking industry. It plays an important role in geopolitical relations, playing host each year to the G20 World Economic Forum in Davos. Geneva is home to one of the main UN offices in Europe, as well as more than 750 NGO’s.
A stable economy, low interest rates, world class education and the existence of a number of multinationals such as Glencore, Nestle and Roche Group, all provide a solid platform and framework for foreign investment.
Five reasons to own real estate in Switzerland
- Economic stability – With modest, but stable GDP growth (normally within the range of 1-2% per annum), the boom and bust housing cycles that are sometimes associated with other western economies, are often avoided. As well as economic stability, Switzerland enjoys historically low interest rates. The Swiss National Bank’s interest rate is currently minus 0.75%, meaning that borrowing rates are just +/- 1% for residential or commercial real estate assets.
- Currency strength - 20 years ago, 1 US $ would buy 1.77 CHF. Today, a dollar is worth just 0.89 CHF. This means that asset prices in Switzerland have appreciated in real terms, often providing a currency gain to foreign investors, as well as a capital gain.
- Rarity – The Lex Koller legislation restricts the number of second homes that may be acquired by non-Swiss residents to just 1,500 per annum. There is also now a ban on the construction of second homes across Switzerland, unless a threshold of 20% of the housing stock in any given commune has not yet been reached.
- Education – Switzerland enjoys some of the highest rates of literacy in the world, supported by a world class education system. Zurich and Lausanne have world leading universities and there a multitude of International Schools and colleges including Le Rosey in Rolle, Beausoleil and Aiglons Colleges in Villars, La Mania in Verbier and Le Regent in Crans Montana.
- Lifestyle – buyers are rewarded by year-round sporting and cultural activities, as well as proximity to European capital cities such as Milan, London, Paris and Madrid, via easily accessible road, train and air transport links.
