Leaving CH and renting out property

Accomodation, House and Garden
1
Not sure if this should go in Permits/visas/government or be here in housing, since it's related to both...

Anyhow, here's the scenario;

Aussie with a C Permit, wife has B permit (also Aussie).

Buy a house in CH, let's say Kanton Schaffhausen.

After a few years the family decides to return to Australia, but doesn't want to sell the house, so it'll be rented out.

Maybe in 5-10 years the family will return to CH.

We know that when you leave CH you lose your residency permit.

So how does it work, that you have an income in CH (from the rental) and outgoings (mortgage, interest, etc) but you have no residency status? You would still have to make a Tax Return, but...you have no residency. This doesn't make sense.

Say in 5-10 years time you want to come back to CH, you are starting from scratch i.e. need to find an employer to sponsor you & get you a B permit. No guarantee that you will find either.

So it could be that you own a property here, but have no right to live in it?

Have I missed something? How does it work if you own property here but are no longer resident / have no permit and you decide to come back? To retire, to work, whatever the case.

I'm yet to find an explanation of this example. Closest was a UK citizen, but that's different because of EU vs. Dritte Lände (Third World) citizenships...

2
As a C permit holder, you can ask for "leave" from your gemeinde.

Abwesenheit Bewilligung

Aussie son leaving home ( with a C permit ) - tips needed

Leaving Ch: how to declare it?

3
Thanks, saw those already.

The difference here being that you can get a leave of absence for 2 years, with the "possibility" of another 2, to a maximum of 4, like Aussie Kev's young bloke.

I'm talking about an absence of 5-10 years. So you would definetly lose your permit.

The question is, how does this affect your rights and future as a property owner in Switzerland?

4
I am no expert but from my understanding, you can not rent out the property with your visa status. I am in a similar situation, my wife is swiss but half the mortgage is in my name so we cant rent out the house if we wanted to. Once again I am no expert in this matter....

5
You can rent out your property if you have a C permit, but not with a B permit.

Which brings on my question; you have a C permit, rent out your house, then leave the country, which cancels your permit, what happens next?

Lets assume (dangerous, i know!) as a non-resident foreigner, but property owner, can rent out your property, i'm sure lots of people already do.

But what about if you want to live in that property some time down the track, you've got no permit...!?!?

6
Do you own this property outright?

Owning a property does not give you any rights of residence.

7
There is a PDF worth reading up:

http://www.bj.admin.ch/content/bj/en...eckerwerb.html

8
a non-EU person I know bought recently and was told they would have to sell the property if they left CH. not sure if it is true - you should ask the authorities in your canton/gemeinde for a written opinion.

9
hey cambo - please send your final answer - if you get one...i would be really interested. all the docs i read is on getting permission to buy...your question is if i understand correctly - so now i've a house - can i leave the country for more than 4 years and rent it? sd

10
Thank-you all for your replies!

No it would have a mortgage on it, with a Swiss bank.

Yes I know that owning a property doesn't automatically give right of residence, as confirmed by that quote from jrspet.

Hmmm, on a side note, I wonder what a banks perspective on this would be...

That's precisely the sort of thing i'm worried about!

If you've got no permit, how could you legitimatly earn an income from a rental property in CH?

If you've no permit, how do you do a tax return?

That's the first half of the question, yes.

Thanks jrspet. Though this is clear about who is eligble to buy a property, it doesn't mention anything about keeping it or renting it out if/when you leave...

Clearly, you need a permit to buy a house, which I have now. That's not the problem here.

What happens if I leave the country long-term, want to keep the house to rent it out, and one day, come back to live in it?

11
Well, if I were you, I would suspend the C permit ( 2.5 years and come back and ask for an extension if possible ) and earn my income and pay taxes in CH although resident in AU.

The C permit is also useful were I to desire the red passport.

12
The PDF answers your question: you'll need permission to own it as a non-resident.

Now, the bank's perspective... That's an interesting question. There are plenty of threads on that on here.

The pension fund will ask you to pay back any contributions from the fund. Since the property is no longer your primary residence the bank, if they are still interested in providing you with a mortgage, may ask you to pay in up to 40-50% of the value of the house. 20% deposits are for primary residence. 40-50% deposits are for second homes and rental properties.

As for the last question, if you can keep the house and you get another permit there is no reason you can't live it. But having the house is not a reason for you to get a permit.

13
Cambo.........join the Klettgau gang,buy a lovely house for the missus, enjoy the spare money you have from mortgage V renting, and worry about the rest when it happens

14
Thanks again for all the replies!

It's an interesting idea. I did think about this, and the only "simple" way to make that work is to establish a GmbH, and sub-contract out any employment overseas back to the company here. Complicated, and also quite an investment to kickoff with, need 20K upfront minimum. Then the property could be a company asset, even if the Swiss company has overseas ownership/management and income.

It doesn't help me in this case, while I would only have to wait only anther 6 years, my wife would have to wait 11, since applications for citizenship need to be married couples together. BTW don't say passport, it's citizenship, remember the SVP poster with the hands grabbing at the red passports?

But as a C permit holder I don't need permission to buy it.

Do you mean, that I need permission to keep a house that I already bought? Ouch.

But maybe this bit in section 6b applies;

" If the buyer changes his place of domicile, he need not sell the dwelling and can dispose of it as he sees fit. He may continue to use it as a secondary or holiday residence or rent it to third parties. He may also purchase another home in his new place of domicile without having to sell the first one. However, a buyer who had no intention of living in that home permanently is in violation of the law, especially when he changes his place of domicile for the sole purpose of being able to purchase several dwellings without requiring authori-sation. In such cases, the appropriate authorities can invoke authorisation requirements retroactively (art. 25, para 1 bis, FL) and can order the reinstatement of the original legal situation (art. 27 FL)."

Doesn't clarify if place of domicile includes leaving the country. Maybe that won't matter, given your other info re the mortgage...

That's something else I was not aware of. Using the pension is the only way the average joe can afford to buy a house. So you could be looking at big bucks to pay your way out of the country, or be forced to sell the house if you can't muster up for the pension, and maybe up to half the mortgage?...imagine that; "Yes sir, you're welcome to leave but please pay CHF 100K to your Pensionskasse, and another CHF 300K to your bank. Or perhaps sir might like to sell his house?" Has this actually happened to someone? It's not such a unique situation is it?

Would love to, that's the plan, just doing my homework first! By the sounds of things it was a good idea before jumping in! Bloody hell....see you at the pub next Friday?

Getting back to the law, I think this only applies to us third world people, here is another excerpt from 6b;

"As nationals of EC and EFTA Member States domiciled in Switzerland are not considered as persons abroad (see 5a), the articles on main resi-dences do not apply to them. They apply only to nationals of other foreign countries who are domiciled in Switzerland..."

Back of the bus as usual...

15
be great to have you out here in the sunshine !!! wont be at pub for a few weeks, mark is in singapore and i am off to the UK for a couple of weeks....keep us posted with the house news !!

16
I'm not sure you can just transfer ownership of the house to the newly formed company.

Once your resident permit expires you are a foreigner. So you will need to get approval to continue to own your home. See above where it says "whether the property is in foreign hands".

And once you lose your permit you are no longer domiciled in Switzerland.

I'm guessing you haven't actually purchased yet. When you go to sign the papers they will go over all these restriction including circumstances in which the loan will be called in, the conditions for taking out your pension, etc, etc.

Maybe you should go talk to the bank and ask them all these scenarios. They are the only ones who will tell you if they will call in the loan or let you keep it, they will tell you the conditions for a rental property etc, etc. Plus they can give you a clue about how strictly these rules against foreign ownership are enforced. I find people at the bank branches are a wealth of information.

If you are planning on leaving, which it sounds like you are, I would thing twice or three times before I bought, especially in an environment where there are talks of "bubbles".

17
Thanks miniMia.

Well that pretty much sums it up then, just a couple of clarifications from my side;

- No, haven't bought yet, just doing my homework first.

- The bank would be the next port of call, so yes I hope they can clarify these scenarios.

- I'm not planning on leaving. I'm just investigating all possible eventualities of buying a house here. As I said, we have at least 11 years to wait for the chance to apply for citizenship, and a lot can happen in 11 years! You can't plan for these things, but at least be aware of what the options and restrictions are.

As i've found out over the last 7 years, things work very differently for EU/EFTA or even USA/CAN citizens here.

A German or Brit won't have to worry about these things, but we do!

18
Yes. Sadly you do. But look at this way, before you couldn't even buy! So things are looking up.

(PS, the thanks button in on the lower right. )

19
To OP,

Take the forum's input as brainstormed ideas but not final answer for such a big issue:

1)laws are different by canton

2)lawyers should be the one giving you the correct answer (ideally the one handling your purchase contract)

3)bank could contribute briefly basing on their experience. What they care about is that you could pay the mortgage...

for my case, my husband is EU permit C and I'm non-EU permit B. We bought our apartment 2 years ago. We did the contract in the notaire (lawyer office) with the architect (who also owns the land already).

- as usual, the lawyer explain the purchase contract to us. One of the clause actually talk about re-selling, residing and renting for EU vs non-EU permit; permit C vs permit B. Therefore, I think you probably have forgotten this. you might want to get back to the contract/your lawyer on this.

- in case it's a different contract by canton, my recall is that what is more important is whether you're EU or non-EU before the type of permit. E.g. for my case, i'm never allowed to rent or sell the apartment since i'm non-EU.....etc

- actually we did ask your same question to the bank which gave us an obviously vague answer. What they concern is that you don't have any income after leaving the country so they would have to re-evaluate your ability to pay mortgage and thus the loan if "you legally notifying them that you're leaving".... so when it comes to the bank, everything is about ability to pay as i mentioned about.

- in your very first post, you mentioned about "So it could be that you own a property here, but have no right to live in it?" --- I actually had the same question to our lawyer (cause I kept asking him different scenario in related to ownership given the vulnerability of my permit). The answer is YES, this could happen. The possible way to avoid this is that if you decide not to live in your own property for longer than 2 years, you need to tell the authority and ask for 'approval' in order to avoid falling into this status.

this is what i experienced by myself in my canton. good luck.

added : just noticed that you haven't purchased a house here yet, so again if you want an exact answer, ask a notaire who deals with apartment purchase would be the most reliable source.

20
The bank (and the pension fund) will also tell him under which circumstances they will call in the loan, which I think is quite important.

If you don't have the money to pay up when they request it, you'll be forced to sell. And in this market, who know if you can sell it for the same, more, or less than you bought it for.