Two distinct groups are attracted to buy property in Switzerland: the rich, who see it as a low-tax haven in one of the most stable countries in the world; and skiers looking for a chalet or apartment in Europe's premier mountain range.
The hurdles to buying are greater than in just about any other country on the continent - though Switzerland's exclusivity is gradually being eroded and opportunities are increasing in number.
What buyers find in Switzerland is a country where both property prices and the cost of living are high, though neither quite as daunting to the British as they once were, and where quality is easier to find than value for money.
It is also a country that offers majestic mountain scenery, excellent food, and a culture that is warmer and more diverse than it is sometimes portrayed.
The bankruptcy of heavily-indebted SwissAir, the former national flag carrier, in 2001, was a traumatic event for the people of Switzerland, since it had always been a symbol of stability and success. The airline was eventually rescued and renamed as Swiss, in which guise it has made something of a comeback and is now effectively part of Lufthansa.
Swiss now flies from Birmingham and Manchester to Zurich, as well as from London City airport to Zurich, Basel and Geneva. Other airlines flying to Switzerland in 2007 include British Airways, Lufthansa, Luxair, Easyjet and RyanAir. Most flights go to the three main airports, Basel, Geneva and Zurich, but there are also a few charters in summer to Bern.
Switzerland has no sea connections, as it is landlocked. If you're determined to arrive by water, you could take a boat across Lake Geneva from the French side.
You can travel easily to Switzerland from the UK by train, using Eurostar then connecting with a TGV service from Paris to Geneva, Lausanne, Bern or Zurich. The journey from London takes around nine hours including the transfer in Paris. Fares start from around £110 return.
Switzerland's rail network is one of the best in Europe. It has nearly 3,000km of track and 800 stations which considering the size of the country, makes it also one of the most intensively-used. More than half the population travel regularly by rail and punctuality is also a source of pride: more than 19 out of 20 trains arrive within four minutes of schedule.
There are seven big 'RailCity' stations - Zurich, Bern, Basel, Lausanne, Geneva, Winterthur and Lucerne - which offer international services and are well developed with shopping and other facilities. There are many small rail operators in Switzerland, but the main railway company is SBB, the Swiss Federal Railway Company (CFF in French and FFS in Italian) which carries 87% of all passenger traffic.
There is a number of good value rail passes available; for example, for £217 you can buy a month-long 2nd class pass to the entire Swiss rail network. And if you're not a permanent Swiss resident, you can buy a Swiss Travel System all-in-one ticket which entitles you to travel on all trains, buses, boats and trams throughout the entire country for £240 for a month.
Switzerland has 71,000km of roads including some of the most scenic routes you could hope to find anywhere. The vast majority are not going to get you anywhere in a hurry, though, and it's a good idea to check drive times in advance, for example with Michelin's online travel planner, as in mountainous areas the distance as the crow flies can have little bearing on the time required.
There is over 1,600 km of motorways, and to use them, you must purchase a vignette or toll sticker, which costs 40 Swiss Francs per annum. It's also important when using Swiss roads to know which passes are open throughout the year.
Buses serve two main purposes in Switzerland - they provide transport within towns and cities, and they service the areas that aren't accessed by rail. They are well integrated with the rail network, so you can often step off a train and straight onto a bus. Around 50 companies operate buses, trolleybuses and trams in Switzerland, including numerous tour operators.
Postbuses, operated by Swiss Post, service mainly long-distance routes and often need to be booked in advance. You can also send luggage ahead and collect it from the post office at the other end. Trolleybuses - buses which are powered by overhead electricity lines - were introduced some 70 years ago in a number of the main towns and cities and are still going strong. Trams operate in a number of cities including Basel, Freibourg and Zurich.
The main climatic variation in Switzerland is caused by the range in altitude, from the higher Alpine peaks at over 4,000m which are covered by snow throughout the year, to the much lower plateaus. There are four main climatic regions. The area around Lugano in the south-east is the warmest, with mild winters and warm, almost Mediterranean summers.
The central plateau including Zurich, where most of the population lives, has cold winters with lots of snow and fog, and summers are typically quite wet. The Alps, which stretch from Geneva to Austria along the southern side of Switzerland, and cover more than half the country by area, perversely offer some of the best weather in winter, the higher you go. It is often sunny high on the slopes when it is cloudy down in the valleys. In summer, though, it can be the other way round.
The fourth area is the smaller Jura mountain range, which stretches from Geneva north-east towards Basel. Here, there is a lot of snow in winter and wetter summers than in the Alps. One of Switzerland's strengths as a winter sports destination is that the weather is not that extreme. Even in January, the average temperature in the Alps is only a few degrees below freezing point, making skiing a great deal more agreeable than in North America.
Probably no country in Europe has quite such a complex set of spoken languages as Switzerland. Around 64% of the population count German as their mother tongue; 20% French; 6.5% Italian; and 0.5% per cent an obscure language known variously as Romansh, Romansch, or Romanic. In addition to these four official languages, there are small percentages of immigrants speaking a smattering of other languages from Turkish to Spanish. And then there is English, spoken widely in tourist and business circles and among Switzerland's more prosperous residents.
The language you will have to grapple with depends almost entirely upon where you buy property; Rumantsch is confined to a few valleys in the south-east of the country; German is the official language in the north and the central plateau; French in the Alps around Geneva; and Italian in the south, mainly in the canton of Ticino.
A further complication is that Swiss German - the dominant language - consists of a dozen different regional dialects, all of which are quite distinct from the language spoken in Germany. There are different pronunciations, some of the verb cases are not used in Swiss German, and a vast range of different vocabulary, much of it emanating from rural life in Switzerland. Written language, though, is usually standard German. In practice, many British people tend to buy within the French-speaking part of the country anyway, where there is far less dialect used.
Switzerland is not a member of the European Union, but for citizens of the UK and other western European countries, no visa is required to visit - just a passport. Non-residents can stay for up to three months at a time, after which you must leave for at least one month, and not spend more than six months in the year in Switzerland.
If you wish to work, you must apply for a permit to do so. At the time of writing in 2007, residency is a somewhat vexed subject in Switzerland. The country has bilateral agreements with the EU 15 countries and the European Free Trade Area countries to make it possible for their citizens to live in Switzerland. Most EU nationals would apply for a CE residence permit, which is an upgraded version of the B permit, allowing you to live in Switzerland for five years, rather than one. But as Switzerland is a federal state, you must first apply to one of the cantons, rather than the federal government for your residence permit.
To qualify, you must convince them that you will have at least Swiss Francs 50,000 (£20,000) of income each year, whether this is generated by your business, employment, or is a retirement income. Residency also entitles you to bring your dependants, including wife and children, to live in Switzerland with you.
But it is far from being an automatic process. Consideration will be given to a wide range of factors, certainly including your background and any criminal records and it will be expected that you do actually live in the country for most of the year. It may be advisable to appoint a lawyer to give your application the best chance.
property ownership and the buying process
The rules on property ownership are pretty complex. If you are a permanent or even short-term resident in Switzerland, then in theory at least, you have the same rights to buy any property as a Swiss citizen. The bilateral agreements signed in 2002 with the EU led to a revision of the Lex Friedrich, the law which governs property purchase by overseas nationals. The new version says that citizens of EU (and EFTA) countries who are resident in Switzerland can buy a primary home and a holiday home, and are free to sell them if they leave the country.
If you don't have residency, however, and you're looking to buy a second home or holiday home in Switzerland, then it is another matter. You must apply for a permit and these are controlled by the federal government under a strict quota system which allows only 1,400 permits each year, in the main tourist areas. Many cantons - including the main cities such as Zurich or Geneva - don't allow any second homes to be sold to overseas nationals; the quota of permits is distributed among the cantons that do.
A third possibility is that you are non-resident, but wish to move your main residence to Switzerland through buying a property. In this event, you have simultaneously to apply for residency and establish that a permit is not required for the property purchase.
Finally, the situation was complicated further this year (2007) when Valais, one of the leading cantons that does allow holiday home purchase, declared a moratorium on any new permits being granted in 2007 in seven communes, including popular locations such as Verbier, Grimentz and Veysonnaz. The moratorium is supposedly intended to clear a backlog of purchases already awaiting authorisation, but it is not clear whether it will be lifted at the end of 2007. What this means is that the only way to be sure of buying in Switzerland is to establish residency. If you can't do that, say you simply want to buy a ski apartment or chalet, you need to look very carefully at where you attempt to buy.
The actual buying process varies a little by canton, but the basic principle is that you agree terms with the seller, arrange financing, and then make an appointment with a local notary public. The notary's role is to check that the transaction is legal and then to make it happen. He or she checks that the seller really owns the property, that you have the right to buy it and that you understand what you are buying. The money is paid to the notary and released when the change of ownership has been properly registered first with the land registry, then with the canton.
Fees and taxes
The main costs associated with buying are the notary's fees and a purchase tax which varies from canton to canton; on average you should allow around 4% of the purchase prices (2007).
The telecommunications market was opened up to competition in 1998. Swisscom, the former state monopoly, is still the biggest provider of fixed line telephone services, but there is now a good range of options for long-distance calls, including GTN, Orange and Econophone. Swisscom is still the only company that can install a phone line to your home and you can order a new line by telephone or from one of their retail outlets. Swisscom's service is billed monthly. One anomaly of using the phone in Switzerland is that you have to dial the local two- or three-digit code even when you are in the same area.
The three main providers in the mobile market are Swisscom, Orange and Sunrise, with each having their own cell network on which other operators piggyback. Swisscom is reckoned to have the best network coverage, which is important if you are in a remote location. You can opt for a pre-pay calling plan but, unlike the UK, you still have to register your phone even if you don't have a contract. Operators which offer budget pre-pay calling plans include Yallo, M-Budget-Mobile, and Coop Mobile.
Swisscom provides broadband services under the Bluewin brand name. It has a 3.5Mb per second service at SFr49 a month; or a 5Mb per second service for SFr69 per month. ISDN lines offering faster dial-up internet access are also common in Switzerland. The country had the fifth highest penetration of broadband of all OECD countries at the end of 2006, with 26% of homes being wired for broadband.
Like everything in Switzerland, public television is broadcast in four languages under the auspices of the non-profit broadcaster SRG SSR idée Suisse - otherwise known as the Swiss Broadcasting Company (SBC). It is effectively divided into four associations which each make their own programmes with a joint central production and broadcast organisation. There is also a wide range of commercial stations, many of them local. You can pick up Sky and other UK channels via the Astra satellite if you have a large enough dish. According to one pundit, a 1.2m dish will be required.
Do they have banks in Switzerland? With the possible exception of cuckoo clocks and holey cheese, there is nothing for which the country is better known. There are around 600 banks in all - a remarkable figure for a small country - of which the best known are the two international giants Union Bank Switzerland (UBS) and Credit Suisse. Most of these are private banks renowned for their discretion and secrecy - it is no coincidence that a third of all the assets held offshore in the world are in Switzerland.
Assuming you're looking for more down-to-earth banking facilities, there is plenty of choice - one familiar name is Lloyds TSB which has had a branch in Geneva since 1916. Swiss banks are pretty advanced in terms of services such as online and telephone banking, cards and so on. It is possible to take out an account in a foreign currency, but it is unlikely to pay a good rate of interest, so you are probably best advised to get an account in Swiss Francs - one of the most stable currencies in the world.
Along with a stable currency, Switzerland has some of the lowest interest rates in the world (2007). It is possible to get a loan for your purchase in Switzerland from as little as 2.5% which makes it - unusually - a far more attractive proposition to borrow in Switzerland than to raise money from your property in the UK. The minimum loan is usually around £150,000 and the maximum loan to value is 80%, with terms of up to 35 years available. The cost of arranging the mortgage is around SFr 500.
The taxation system in Switzerland, like much else, is far from straightforward. There is no single centralised system of taxation; instead, some taxes are levied by the federal government, others by individual cantons at different rates. What's more, for people who are really high net worth, i.e. rich, and wish to become residents, cantons can negotiate a lump sum tax arrangement which is not based on percentage rates.
Income tax, for example, is payable at three different levels: federal, cantonal and municipal. The top rate for federal tax is 11.5% for income over SFr 843,000; cantonal tax is usually around twice the level of federal tax; and municipal tax is a small fraction of that. However, you would never have to pay more than 40% in total, and the maximum rate in most cantons is much lower than that.
Switzerland has no capital gains tax, but there is a wealth tax, which is levied at cantonal level, on assets above a pre-determined threshold. On average this is around 1.5% per annum. Inheritance tax is also decided by individual cantons and is even more complicated. In some cases the estate pays less tax according to how close is the relationship to the person set to inherit; if it is a child or surviving spouse there may even be no tax to pay at all. This is one country where you would definitely benefit from having tax advice. Vat, incidentally, is 7.6%.
Even public holidays in Switzerland are not universal; the religious ones tend to be observed much more in particular cantons in the more Catholic areas, while others - notably the Swiss National Day - are observed throughout the country.
Alexander Garrett is a freelance property writer who contributes regularly to The Observer and British Airways' Business Life.
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