The law on foreign ownership of property in Switzerland (Lex Koller) is to be abolished in three years. The Swiss federal government has announced that by 2010 each canton will have the responsibility for its own foreign property acquisition laws which will result in the immediate transfer of property titles as opposed to the current system where a buyer must wait for an authorisation.
At present, the Lex Koller is restrictive for non-Swiss nationals but as a result of this new initiative it is predicted that the demand for Swiss homes will increase, while the supply is likely to continue to be carefully monitored by each canton.
The aim of this move is twofold: to avoid a construction boom while facilitating and increasing tourist accommodation. The current prohibition on the development or acquisition of residential property by foreign companies remains.
As the current law stands, foreigners, any foreign-based companies or even Swiss-based companies run by non-Swiss are restricted from acquiring property in Switzerland. They need an authorisation from the cantonal authority before gaining title of their property.
Managing director of Pure International, Sean Collins foresees that the abolishment of this law will increase demand for properties in Switzerland.
‘Within the parameters of the new spatial planning regulations which will accompany this move, it will be up to the individual cantons to determine their own laws in relation to foreign property acquisition, an example of which was seen by the moratorium imposed in canton Valais in January.’
Mr Collins continues: ‘While it remains to be seen how the abolition of the Lex Koller will truly impact the market, we certainly anticipate cantons with high numbers of tourist resorts continuing to exploit the benefits of foreign investment, therefore anyone currently considering a second home in Switzerland should take advantage of current pricing.’