Step 2 - Check "LAFE" Eligibility (what can you buy?)
The purchase of property in Switzerland is restricted by a federal law known as “Lex Koller” (originally called"Lex Friedrich"). It strongly recommended to find out right from the beginning if your are eligible to buying Swiss real estate.
Besides the federal law there are cantonal regulations, referred to as the "LAFE" (Commissione sulla Legge federale sull’acquisto di fondi da parte di persone all’estero)", that restrict the permission of persons from abroad of becoming the owner of a property in Switzerland. The "LAFE" is actually the Cantonal Law `executing` the "Lex Koller" Federal Law. When you purchase a property make sure you make it subject to "LAFE"approval. The procedure is complex and it recommended to take a local lawyer to handle it for you. Overall the "LAFE" approval process can take up to several months to complete. Only the following persons are not subject to the "LAFE":
- Swiss citizens, even those with multiple nationalities
- Citizens from European Union and EFTA (European Free Trade Association) countries that are legally domiciled in Switzerland
- Citizens from other countries with a current Swiss residence "C" permit
An authorization to purchase a holiday home which is located in a tourist area, as defined by the Canton, and with a surface of no more than 200 m2 (including kitchen, entrance, bathroom(s), in-door swimming pool, sauna, but excluding the cellar, any balconies and the staircase) and the total property being no more than 1'000 m2, is typically granted. Real estate (such as dwellings, private houses, city apartments, tenements, etc.) in "non tourist" locations are subject to a very stringent approval process, and in practice this approval is seldom granted if you are a non-resident.
Furthermore you should be aware that a quota system is applied to the number of holiday homes sold to foreigners each year. Once the specific quota is exceeded to may need to wait for an approval in the following year.
As part of the "LAFE" process, a foreign non-resident must highlight "exceptionally close links" to the location where you plan the acquisition. For example, the fact that you have spend your summer holidays in the location since your childhood is recognized by the canton as a valid reason for granting approval. Once the canton has granted approval, the federal approval is typically a formality.
Please take the "LAFE" approval very seriously. Details (in Italian) can be found in the following article:
"Acquisto di fondi da parte di persone all'estero"
Last but not least, owning a property in Switzerland does not automatically imply than you can become a permanent resident.
Latest News (June 2010): The Lex Koller is likely to be abolished sometime in the future and articles on this have been circulating on the web for the past 5 years. The abolishment date is tied to the execution of the revised Spatial Planning Law. Changes to the current "LAFE" procedure are NOT expected for at least another 6 months. Once the law is abolished the cantons will probably instate other restrictions that are likely to include a maximum percentage of summer residences compared to the overall availability of homes and/or a quota on the number of holiday homes that can be sold to foreigners per year.
View from a property on the Gambarogno Riviera on the left shores of Lago Maggiore. The area begins at the foot of the Monte Ceneri. Also The Brissago Islands can be seen from this point, known for being the botanic garden of Canton Ticino.