Please set subtitles on Youtube in English.
If you are looking for a flat to buy in the canton of Geneva, it is useful to know the following points:
Different types of property
In Switzerland and Geneva, there are several ownership regimes.
Most of flats and new flats are for sale in ppe. PPE is the abreviation for "propriété par étage" (condominium ownership). You buy an exclusive right of your condominium unit and you will be co-owner of the building. The condominium unit is drawn in the distribution booklet and gives you the exclusive right to the flat. The common parts of the building are exempted from the exclusive right of the owners of the condominium unit. You will be entered in the land register as the owner of the condominium unit. More information: Condominium ownership - legal structure in Switzerland
Some older flats are for sale in SIAL. SIAL is the abbreviation for "Société Immobilière Actionnaire Locataire" (property company shareholder-tenant). You buy a share certificate and you will have the exclusive right to rent a specific flat. The transfer of shares must be approved by the administrative board and recorded in the register of shareholders and on the title. In order to obtain a credit, the shareholder can pledge the share certificate and the share of the related unsecured claims. The interest on the credit is higher than the interest on a traditional mortgage loan. Charges and fees are distributed in relation to the number of shares held by each shareholder.
Some flats are sold as SIAL-PPE, i.e. as a "real estate company of tenant shareholders in condminium ownership " or share ownership, PPA. Ownership of a floor unit is linked to the share of unsecured receivables. The shareholder has a right to a lease for his floor unit. The shareholder's loan is secured by the registration of real estate pledges by the company on the condominium unit against the deposit of the shares of the unit with the company. In the event of the forced realisation of the unit, the shares are cancelled. Social contributions are apportioned in relation to the number of shares and co-ownership charges in relation to the thousandths of co-ownership.
You are buying a certificate of participation from a cooperative and not a flat. You can buy a share in a cooperative and as a member of the cooperative you can rent the condominium unit at a low rent and the cooperative remains the owner of the building.
More information: Legal regimes for property in Switzerland
The form of the contract
A sale of condominium ownership is only valid if it is concluded in the form of a notarially recorded instrument or deed. In Geneva, it is the notary who must draw up an authentic deed. A sale of shares is not a real estate sale, because the real estate company is registered as the owner in the land register and the sale is made by the transfer of the shares.
Casatax, reduction of registration fees
Casatax, this is art. 8A of the Geneva law on registration fees. If you buy a principal residence located in the canton of Geneva, you can benefit from a reduction in transfer taxes if the purchase price does not exceed the amount set by the state. This amount amounts to CHF 1,202,607 in 2020 and is fixed annually. More details: Casatax: reduced registration fees when buying a home in Geneva.
More information: Casatax 2020 - reduction of the registration fee when purchasing from its housing
Lex Koller
The Lex Koller regulates the acquisition of real estate by persons abroad. If you are a national of a member state of the European Union or the European Free Trade Association (EFTA) and are legally resident in Switzerland, the purchase is not subject to the Lex Koller. If you are a cross-border commuter with a G permit, you will be able to buy a second home in the area where you work. If you are a national of another country and have a C permit, you can buy a property in Switzerland if you are acting on your own account and if no more than one third of the financing for the property comes from abroad. If you have a B residence permit, you will be able to buy a flat in which you live permanently.
More information: Persons abroad Lex Koller - can foreigners buy properties in Switzerland?
Family dwelling
If you are married or in a partnership and wish to buy a principal residence that serves as a home for you and your spouse, you can only buy your family home with the express consent of your spouse.
Finance and acquisition costs
In principle, you will have to provide 20% of your own funds, of which not more than the half (10%) can come from the 2nd pillar if you meet certain conditions. Acquisition costs must be added to the purchase price. Count between 5 and 6% calculated on the purchase price. It is useful to see your banker or insurer even before you start looking for a flat to simulate a financial plan.
More information: Calculate your budget for the purchase of your pincipal home
© Written and translated by Esther Lauber, Real Estate Trustee with Advanced Federal Diploma of Professional Education and Training, real estate broker in Geneva
Partly translated from French to English with DeepL, in case of doubt, the French or Germain version should apply