Home ownership

Purchasing a house: an A-Z checklist.

Our expert tips for house hunting and financing.

Patrick Stahl, Team Leader Portfoliomanagement Mortgages

Patrick Stahl

Patrick started his career in finance in 2008, and is a Business Economist. As a specialist for mortgages, Patrick was responsible for advising customers and training his colleagues in the subject. Patrick has led the Portfolio Management Mortgages Team since January 2023.

15.01.2024,
reading time 6 minutes

Many of us dream of owning our own home. To make this dream a reality, and ensure you can feel comfortable in your home over the long term, there are a few things you need to keep in mind. Our checklist will help you find answers to the most frequently asked questions, from house hunting to getting a mortgage.

1. Purchase price, mortgage and additional costs

Your budget is the deciding factor when searching for and purchasing a house. So before you start searching for a place to call home, you need to make sure that you understand your financial situation and that you can get a mortgage. The following information could help:

Questions and answers

In general, it is a good idea to contact us early on and discuss how much capital you have, your annual income and affordability. Based on this information, we can work with you to define a budget for the purchase.

You must provide at least 20% of the purchase price as a down payment. This can, in part, be made up of money from your pension fund, as an example. However, at least 10% of the purchase price must come from liquid assets, such as savings, advances on inheritance or money in your voluntary 3rd pillar.

In addition to paying a down payment of at least 20% of the cost of the home, you can finance your purchase with a mortgage, i.e. a loan. A fixed-rate mortgage means that the interest rate is fixed and remains the same over an agreed period. On the one hand, this can offer you financial security, on the other it could be risky. For example, if your life circumstances were to change and impact your financial situation. You could also choose a variable mortgage. Interest rates for variable mortgages are determined by the market and may change with an advance notice of three months. You can cancel your variable mortgage at any time with 6 months notice, a fixed-rate mortgage can only be cancelled at the end of the term. We recommend that you make an appointment with our team of advisors to discuss your individual situation and what mortgage is right for you.

When purchasing a house, it is not just important that you have enough financial resources at the time of the purchase, but also that you can afford the mortgage over the long term. Affordability calculates the relationship between the monthly mortgage payment, amortisation and costs for running maintenance and ancillary fees. To ensure affordability over the long term, and take potential interest rate rises into account, a calculated interest rate of 5% is used. The monthly costs may not exceed 33% of your income. If the monthly costs exceed 33% of your income, the house is not affordable.

It is important that you start saving enough money to pay for maintenance and repair costs right from the start. As a general rule, you should save approximately 1% of the purchase price each year. However, if the house is older, you should save more than that as you will be faced with renovation costs sooner or later.

In Switzerland, in addition to the purchase price of the property, you will have to pay fees for the change of ownership tax, entry into the land register, notary costs and the borrower’s note.

As a general rule, the earlier, the better. The real estate market in Switzerland is limited, and demand has remained high. That means that sellers often sell to the buyer who can make the highest bid. So it’s a good idea to have an overview of your financing situation early on, and make sure you have already clarified the most important questions with us by the time you have found a home you want to buy.

2. How to find the right way property

To ensure you find a home that is right for you, you should think about the location and features you want your future house to have. It’s also a good idea to take some time to think about the things you would be willing to forgo or compromise on, based on the market.

Are you searching for a house in the country or do you want to be close to a city? In which canton?
What requirements do you have for the location in regards to infrastructure and tax rate?
Do you want a detached house or a terraced house?
How many rooms or square metres do you need?
Are you looking for extra space for your hobbies? Then you might want to pay attention to the size of the garden or extra rooms.
Are you looking for a modern home or an older house that you can renovate?

Once you have written a list of things you want, you can start your search. The best way to search is online, or you might choose to consult a real estate agent.

3. Checklist for viewing – what state is the house in?

You have found a house you would like to look at, and now comes the exciting part: the viewing. These tips will help prepare you to look at the house you are interested in.

Getting started: Make an appointment during the daytime, when it is light outside. This will give you a better idea of what the house and its surroundings look like.
Location and features: What is the neighbourhood like? Who lives next door? Does the infrastructure, such as public transport links, shopping options or schools, meet your needs?
Property: When viewing the house, take note of the light and whether it gets any sun. It can be a good idea to view the property multiple times, during different times of the day. In addition, it is very important that you ask if there are any conditions listed in the land register, such as public footpath access rights or how close to the neighbouring house you can build.
Condition of the house: Discovering the condition of the house is the most important part of the viewing. Make sure to look at everything, and ask the seller or the real estate agent questions. What needs renovating? Are serious repairs needed, for example, because there is asbestos in the house? What about energy costs? Is the insulation adequate, how is the house heated, and are any replacements necessary, such as new windows?
Interior: Does the house meet your needs in terms of size and division of space? Do the rooms get enough light? Is there enough storage space available (cellar, cupboards, hobby room, etc.)? What about the kitchen, bathroom, flooring? Are they in good shape?
Ancillary fees: How high were ancillary fees over the past few years? Ask to see documentation if possible.

In addition to these factors, specific to the house itself, it can be helpful to know why the current owner wants to sell. This might give you more information about the house itself.