Buying property has legal consequences. A municipal territory is partitioned by the zoning plan into different use zones. It is important that your property be situated in the residential or core zone and how it relates to the other zones, such as the distance to the industrial zone.
The building ordinance sets forth various criteria as to how a house can be built. In particular, the specified dimensions must be adhered to, such as the distance to neighboring properties or roads, the maximum length, width, and height of a house, the number of stories allowed, the type of roof, etc. You can obtain a copy of the zoning plan and the building and zoning ordinance from the municipal administration for a fee.
Development of the Property
A developed property has already been prepped for electricity, sewage, vehicle access, etc. If this is not the case, the costs of such work should be determined in advance.
Property Register Excerpt
This entry shows the area, the owner, and any encumbrances of the property, etc. It also contains information on any rights of access, servitudes and easements, rights of residence, etc. You can obtain a copy of the excerpt at the property register office for a fee and with the consent of the owner.
Property Capital Gains Tax
The seller of a property must pay taxes on capital gains realized from the sale. If the seller fails to do this, the tax office has a right of lien to your purchased property. Before concluding the purchase, you can request a calculation of the property capital gains tax at the tax office. The amount can be extracted from the purchase amount and paid into a blocked account of the seller.
Contractors, subcontractors, and suppliers of materials for work performed in constructing or repairing a building can have a lien entered in the property register for outstanding debts.
Forms of Ownership
You will become a property owner with entry into the property register. There are four forms of property ownership:
- Sole ownership allows you the greatest freedom of disposition. The sole owner has complete control over the property within the confines of the law.
- Joint ownership is based on a special close relationship among the owners, such as marital community property. Joint ownership cannot be divided; the owners can only dispose of the property unanimously.
- In co-ownership, such as in the case of cohabitation, each buyer acquires a specific share of the property, such as ½ or ¼.
- In condominium ownership, the buyer acquires a co-ownership of the land and the building. The owner can dispose only of his/her respective apartment. The majority of the condominium owners decide on the common areas and the land.
Building under Leasehold
A leasehold allows you to construct a building without having to buy the land on which it is built. Instead of a purchase agreement, a leasehold agreement is entered into with an independent and durable right to build for a maximum of 100 years. Through payment of a ground rent, possibly with a cost-indexing clause, the amount that would have to be paid for a house with land is considerably reduced. However, due to a potential indexing, massive cost increases can be incurred over time. A thorough comparison to a conventional purchase – purchase of land for building, purchase of a land parcel with a house, purchase of an apartment or floor in a building – is therefore indispensable.
Payment and Trustee Agent
For the purchase/sale of a property, a payment and trustee agent is always required. In some cantons a notary public performs this function; in other cantons a bank, usually the buyer’s bank. The payment and trustee agent is responsible for all transactions related to the purchase agreement to ensure that the transfer of ownership to the buyer can take place. This includes collection of the purchase price, monitoring of incoming funds, accounting of the sale, and payment of all seller costs: transfer fees, property register fees, capital gains taxes, etc. The cost of a payment and trustee agent can be determined in advance.