First-time buyer guide in Switzerland: your step-by-step roadmap

Buying your first home is a landmark milestone. In Switzerland, the first-time buyer's journey is marked by specific rules that can be surprising, especially for internationals. This guide takes you from first considerations to signing at the notary, helping you avoid the most common mistakes.

Step 1: Assess your financial situation

Before dreaming of oak parquet and open kitchens, lay the financial foundations of your project. Three fundamental questions need answers:

How much equity do you have?

Take a complete inventory of your available resources:

• Liquid savings: savings accounts, easily realisable investments
• Pillar 3a: withdrawable for the purchase of a primary residence
• 2nd pillar (LPP): withdrawable under conditions, but limited to the supplementary 10% of total financing
• Gift or advance on inheritance: subject to cantonal tax rules
• Family loans: accepted by some banks depending on conditions

Remember: of the 20% equity required, at least 10% must come from non-pension fund sources. If your property costs CHF 750,000, you need CHF 150,000 in equity, of which CHF 75,000 minimum must be from non-LPP sources.

What is your gross income?

Add up the gross annual income of all borrowers. Banks take into account:

• Fixed salary (13th month included)
• Recurring bonuses (often counted at 50-70%)
• Stable and documentable supplementary income
• Family allowances (sometimes)

Self-employment income generally requires the financial statements of the last 3 fiscal years.

Do you have existing debts?

Car leases, consumer loans, and other financial commitments are factored into the affordability calculation. Ideally, repay your consumer debts before embarking on a property purchase.

Step 2: Calculate your maximum purchase budget

The maximum budget is determined by the more restrictive of the following two criteria:

Criterion 1: Equity

Your equity represents 20% of the price. Multiply it by 5 to get the theoretical maximum price.

Example: CHF 200,000 in equity = maximum price of CHF 1,000,000

Criterion 2: Affordability

Theoretical annual charges must not exceed 33% of gross income. The calculation works as follows:

Step 3: Search for the property

Finding the ideal property requires method and patience. In western Switzerland, the market remains tight, especially in the Lake Geneva region.

Where to search?

• Online portals: Homegate, ImmoScout24, Comparis Immobilier, Acheter-Louer.ch
• Local real estate agencies: access to properties not yet listed online
• Developers: for new-build and off-plan programmes
• Personal network: let people around you know that you are looking
• Auctions and forced sales: occasional opportunities via the debt enforcement office

Criteria to define

Create a list of criteria and classify them as "essential" and "desirable". The main ones:

• Location: municipality, neighbourhood, proximity to transport and shops
• Property type: condominium (PPE), detached house, semi-detached
• Living area and number of rooms
• General condition and any required works
• Co-ownership charges (for PPE)
• Orientation, views, natural light
• Parking space, cellar, laundry room

Step 4: Visit and evaluate the property

During visits, be methodical. Here are the points to check absolutely:

Building condition

• Year of construction and recent renovations
• Condition of the roof, facade, and windows
• Heating system: type, age, energy consumption
• Cantonal energy certificate (CECB) if available
• Presence of asbestos or other hazardous substances (pre-1990 buildings)
• Condition of plumbing and electrical installations

For a condominium (PPE)

• Management and usage regulations
• Minutes of the last 2-3 general assemblies
• Renovation fund balance and planned works
• Detailed monthly charges
• Usage restrictions (pets, rental, professional activity)

Price assessment

Compare the asking price with recent transactions in the neighbourhood. Banks systematically commission an independent valuation. If their valuation is lower than the purchase price, you will need to cover the difference with additional equity.

Step 5: Secure financing

Do not settle for a single offer. Request quotes from at least 3 to 5 institutions:

• Your main bank
• Cantonal banks (often competitive for first-time buyers)
• Online banks
• Insurance companies (some offer mortgages)
• A mortgage broker to widen the comparison

Elements to compare

Step 6: The notarial procedure

In western Switzerland, property sales must go through a notary. The procedure generally takes place in two stages:

The promise of sale (or conditional purchase agreement)

This document commits both parties subject to certain conditions (financing approval, inspection results). It sets the price, deadlines, and terms of the transaction.

The authentic deed of sale

Signed before a notary, it officially transfers ownership. The notary then proceeds with the inscription in the land registry. Allow 4 to 8 weeks between signing and effective inscription.

Pitfalls to avoid for a first purchase

Experience shows that first-time buyers often make the same mistakes. Here are the main ones:

1. Underestimating additional costs

The purchase price does not represent the total cost. Add transfer taxes, notary fees, land registry, mortgage note, moving costs, and any fitting-out works. Budget 5 to 8% of the purchase price in additional costs.

2. Not comparing mortgage offers

The difference between the best and worst rate can represent CHF 5,000 to CHF 10,000 per year on a CHF 640,000 mortgage. Over 10 years, that is a considerable sum.

3. Buying at maximum capacity

Just because the bank will lend you a certain amount does not mean you should use it entirely. Keep a margin of safety for unexpected events: rate increases, job loss, urgent repairs.

4. Neglecting the property condition

A bargain-priced property may hide expensive works: roof replacement (CHF 30,000 - 80,000), heating replacement (CHF 20,000 - 50,000), energy renovation (CHF 50,000 - 150,000). Have the necessary works estimated before committing.

5. Forgetting imputed rental value

In Switzerland, property owners are taxed on the imputed rental value (valeur locative) of their home. This fictitious income increases your taxable income. This tax impact must be factored into your budget calculation.

6. Using all of your 2nd pillar

Withdrawing from the 2nd pillar reduces your retirement benefits and your coverage in case of disability or death. Favour other equity sources if possible, and precisely evaluate the impact on your benefits before withdrawing.

Typical timeline for a first purchase

First-time buyer checklist

Before you get started, make sure you have checked each point:

• Sufficient equity (20% of which 10% from non-LPP sources)
• Sufficient income for affordability test
• No outstanding consumer debts
• Stable employment situation (probation period completed)
• Emergency savings preserved (3 to 6 months of salary outside equity)
• Clear understanding of additional costs
• Multiple mortgage offers compared
• Property thoroughly inspected (ideally with an expert)
• Tax impact evaluated (imputed rental value, deductions)
• Building insurance and liability coverage planned