EU nationals' financial planning for a Swiss life

Finance, Taxes, Banking, Insurance and Retirement
1

Hi all,

A family (ages 45, 43, 11, 8) holds passports from the an “old” EU country, let’s call it Europa for now. This family loves the Swiss life and is exploring the financial path to make it feasible.

This family has some properties (both rental and living) in Europa, some money staying in another non-EU country, and is comparing the consequence of renting / buying a place of living in CH.

The questions are:

  1. Property tax and obligations to which countries ?
  • Income from rental properties in Europa is not taxed, does it change if I live and have a job or another income in CH ? Does it change if I need to pay to rent a place of living in CH ?
  • Is the properties tax is only subject to the law of Europa ? Or is it changed if I would buy a property (for living) in CH ?
  1. Buying vs renting in 2023-2024 ?
  • Renting is not so bad ? A quick search in this forum suggests that unlike other EU countries, the cost of renting a property in CH is only about 2-3% of its valuation. So renting is still OK I guess. An old thread seems to already address it I guess https://www.englishforum.ch/housing-…apartment.html
  • Property price seems to be in a bubble state ? In Europa properties’ price is declining in 2022-2023 given the interest rate of 4-5%. Will Switzerland follow after the last 20 years of rising from 100 in 2000 to 190 in 2023 ( https://tradingeconomics.com/switzerland/housing-index ) ???
  • Finding a rental in some hot cities is near impossible ? At least in Geneva I heard of horror stories from friends. Is that the same in Zurich or other big cities ?
  1. Mortgage

My initial knowledge on mortgage in CH is that buyer needs to throw 20% cash in, and pay back the next 13% during the next 15 years, and later can have the mortgage running without paying the principal for the next 25 years. And buyer’s income need to be at least of 15% of the property’s price. Is that correct ?

Questions:

  • Do Swiss bank accept hedging on the equity of a property in Europa to reduce its interest rate ?
  1. Pension

One family member has worked 3 years in CH and is still having a 2e-pilier or 3e-pilier something in a bank (BCV: Banque Cantonale Vaudoise).

Should this family move their Europa’s pension funds into CH, if they believe more in the long term prosperity of Switzerland than of Europa ?

2
Sorry guys that my post seems too long.

Some things I can google, but when my mind is chaotic with many questions I'd like to write my thoughts and questions down in one place, in order to organize them.

Should I cut my long post in pieces ?

3
When you say an “old EU country” - do you mean a country that was an original member? Or a country that is no longer a member (UK)?

4
As to 1: you are taxed on your world wide income, so yes, rental income as well. And you renting in CH does not change anything to that.

PS: rental income is taxed in a lot of countries in Europe. Also in the Netherlands where you claim to live now.

As to 3: often 30% and you will have huge difficulties finding a bank that takes properties abroad into consideration. How do you think they should determine what the value is?

5
Closing this thread now as this is a dupe of an already banned person.