Strategy

Relaxation of Restrictions on Swiss Property Sales to Foreigners in Sight

Paul Adams Geneva 5 July 2007

Relaxation of Restrictions on Swiss Property Sales to Foreigners in Sight

Purchasing property might get a lot easier for foreigners if the Swiss government gets its way and lifts restrictions on sales. Yesterday the Swiss cabinet announced that there was nothing to fear from foreign buyers, but that the cantons would have to decide themselves how to avoid speculation, especially at popular ski resorts. The government decided the law restricting property sales to foreigners – known as the Lex Koller, after the former justice minister who oversaw its introduction – should be abrogated. If parliament accepts the cabinet proposal, the procedure for purchasing a property will become much simpler for foreigners. Anticipating concerns that removing restrictions will lead to an increased demand for secondary residences in tourist regions, the government is also proposing a change to the country's land management legislation. "We will not lift restrictions without appropriate accompanying measures," said Justice Minister Christoph Blocher. The tourism industry and the cantons are particularly concerned about the so-called "cold bed" phenomenon. Many secondary residences remain empty for much of the year and are only used by their owners for a few weeks. This means there is a lack of accommodation in some resorts despite thousands of beds remaining empty. With nowhere to stay, tourists are moving on and infrastructure such as ski lifts is unused. High land prices also mean it has been more tempting to build expensive holiday homes for wealthy foreigners than hotels. Demand for secondary residences has also been so high in canton Valais that the cantonal government decided late last year to freeze new constructions in seven communes, including jet-set destination Verbier, until further notice.

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