The Buying and Selling Process

Understand the ins and outs of buying and selling property in Switzerland...

Sale and purchase contracts

In Switzerland, purchase and sale contracts with regard to real estate need to be made in writing and need to be notarised.

Preliminary contracts, letters of intent and agreements granting pre-emptive rights or purchase options need to be notarised alike.

Contracts which do not meet the formal requirements are void and unenforceable.

Notaries generally use standardised contracts which they adopt to the individual transaction. However, the parties may wish to include additional provisions with regard to the sale/purchase and should instruct the notary accordingly.

For notarisation, the notary will read the deed to the parties who will then sign the document in the presence of the notary. Thereafter, the notary will authenticate the agreement. Instead of attending in person, either party may choose to appoint an attorney who will sign the document by proxy.

There are certain cantonal variations to the authority of a notary:

Canton of Zürich

In Zurich, notaries hold a law degree and entitled to draw up and notarise deeds with regard to, inter alia, real estate transactions in their respective canton. Notaries in the Canton of Zürich are working for the public cantonal services and are not private practitioners. Information about the notaries of Zürich is available on the website www.notariate.zh.ch (in German).

Due to the fact that in the Canton of Zürich notaries are belonging to the public cantonal services, there is no free choice of the notary. The transaction has to be performed at the competent notary’s office for the district in which the property is located. The notaries are obliged to take a neutral position in the transaction and have a duty to inform any of the parties of unusual provisions in the contract. Notary's fees amount to of 0.1% of the value/purchase price of the property.

 

The notary will then file the deed with the land register of the respective Canton, and ownership in the real property is transferred only when the deed is registered. The buyer will receive an updated excerpt of the land register showing the transfer of ownership.

Means of financing

As a general rule, up to 80% of the purchase price of a real property may be mortgaged. However, mortgages up to 100% of the purchase price may be obtained if there are additional securities such as cash value life insurance policies or pension funds. Any prospective buyer should invite financing offers from different banks at the place of the real property.

Information supplied by Dr. Michael A Meer, LL.M., Attorney at Law Gruninger Hunziker AG, Zürich / Bern. Tel: +41 (0) 58 356 5050, e-mail / web: www.ghr.ch Copyright © 2009 GHR Rechtsanwälte AG All Rights Reserved