when talking about canton taxes being 5%. Do you mean of the purchase price? Is this a one off fee or annual? I am considering buying in a development in Les Collons. Does anyone here have any views on Les Collons? Is it normal for some of the annual fees to be paid by companies renting chalets? What sort of annual fees can I expect from a stand alone chalet approx 135m2.

TopperT says

"Re running costs this also varies by Canton and whether you are buying a chalet or apartment? Annual running charges in Villars are typically 0.7 - 1% of the market value while in Verbier and Saas Fe these costs are lower approx 0.5%"


Do you mean as a tax. This seems like a huge annual tax. The maths on this are pretty tight any profit being totally reliant on a decent capital gain. i wonder how easy it would be to sell on these properties when they are ten or more years old? Does anyone have any views or experience on this.

Ed

edsmith: I think that this reference was to the one-off purchase tax in each Canton. For the Valais, this was 2.5% when we bought in 2004, and goes up to 5% elsewhere. Main taxes and costs that I can think of are as follows

Purchase (one-off):
- Valais Purchase Tax (2.5% in Valais)
- Notaire's Fee (2.5%)
Mortgage:
- Bank Arrangement Fee
- Notaire's Fee
Annual:
- Any Mortgage Costs
- Cantonal Tax
- Communal Tax
- Visitor's Taxe de sejour (head tax per night)
- Your own visits, Taxe de Sejour*
- Electricity
- Concierge and/or management fee
- Oil for heating/hot water
- Extraordinary projects

For our apartment of 68M2 where share various costs for the whole building, these were/are as follows. *=one-off

2.5% of purchase price - Cantonal Purchase Tax*
2.5% of purchase price - Notaire's Charges
2,000 CHF Mortgage Legal Fees - Notaire
500 CHF Mortgage arrangement Fee - Bank

120 CHF Fixed Taxe de Sejour (our use of apt.)
791 CHF Commune Tax
115 CHF Canton Tax
70 CHF Cable Radio & TV
480 CHF Electricity Charges
2,475 CHF Agency Fee, Comprising: oil heating + hot water; maintenance/refurbishment; concierge; snow clearing; management fee; facilities (sauna, launderette) etc.

Hope this is useful.

Hi Edsmith,

As you are looking at the 4 Valleys and thus in the Canton on Valais as msej449 quotes there is a one off purchase cost of 2.5% total of value of property that includes your taxes and notary fees.

Once you have the place your yearly running costs which include all the yearly taxes, heating, electricity, insurance, maintenance, snow clearing etc are approx 5000 - 7000 CHF dependant on the purchase price and size.

Interhome have quoted me approx figures of 25,000 CHF "net" rental returns per year in Nendaz paid to us before anything you bring in privately but you need to own property in a good location. This more than covers the running costs and paying a lump sum toward your mortgage each year.

Re re-sale the recent moves of the Canton to start shutting down the region for the next 12 months will only increase prices of property (on top of land price increases already being seen).

There is a lot of interest in Switzerland at the moment and if you read the press there is a current polar move in equal proportion to people buying A Place in the "Sun" to A Place in the "Snow" as more and more people see this as an opportunity to have fun as well as increase their investment.

As for your question about selling in the future, the advantage you have selling in 10 years time is you will have the all important permit which means you can sell to a foreigner who does not need to wait to apply for one!

Hope this is of help

I have just discovered this excellent thread and have read with avid interest. I am buying a chalet in Haute Nendaz with a view to renting it out some of the time and using it for ski and summer vacations with my family.

On purchase costs, my understanding is that one needs to pay:

(1) 2.5% notaire's fee, which includes purchase taxes.
(2) An extra 1.5% of the amount borrowed as mortgage to the notaire - this was a bit of a nasty surprise.

And that's it. Surveys are, I am, told, extremely rare in Valais - "Swiss construction quality is excellent" - and there are no supplemental charges payable to the bank for the mortgage.

All in all, cheaper and simpler than in the UK. Also, there's no gazumping.

We could all learn a thing or two from the Swiss. Moreover, the estate agents seem pleasant, well informed and intelligent. How refreshing.

I agree Wolan, the whole process is incredibly easy and the properties if using traditional construction and maintained well should last hundreds of years on top. Just a word of caution though, if you've not signed do it quickly!

quote:

Originally posted by msej449:
TopperT

Feedback does seem to be that chalets and the bigger apartments are more readily rentable, but with the downside that an unrented week is proportionally more of a hole in your finances.

The other thing is that German, Dutch and Danish clients apparently book much later than Brits. Presumably because we have the cross-channel cartel problem, whereas mainland Europeans can check the conditions, book on the 'phone/web, then just hop in a car and go.

The downside of this is that the Swiss customer base may be more sensitive to poor weather consditions. So in a really bad year there's more drop-off in business than for locations with more package tour business.

Re. being over - Yes, we were there last week for a short break. Lots of snow on Friday night and Saturday and we needed the municipal snowplough before we could drive out without chains. All of which is an encouraging start to the season, as this means a sounder base then last year.

Hi
We have just moved to Nendaz on a 6month trial. The area is beautiful we are in week 3 and haven't had much snow which the runs are in desperate need of but we have had plenty of glorious sunshine. I am also looking at property here at the moment with the possibility of creating a catered chalet business as there are none here at present and like previous messages posted the Summer Season is all to play for. I will keep you posted on my path to purchase. Take Care

Hi,
Can I just go back to the earlier discussion of Cantonal purchase tax as I'm confused: nobody has mentioned it to us in relation to our purchase of an existing chalet (i.e. not a new construction). I know about the ongoing taxes (taxe de sejour and the cantonal tax) and the notaires' fees (ouch - as a UK solicitor - not real estate though! - I want their jobs!) but not a one-off purchase tax which sounds a bit like stamp duty.

TAD if you want occasional work as a keyholder/concierge while you make your mind up let me know !!!

The 2.5% notaire fee includes any purchase tax. I don't know exactly what proportion of this goes to the Canton or Federal Government.

One thing I learned yesterday while in Switzerland signing the documents - alas, a few days too late: it is not unusual for notaires, when charging for arranging a mortgage, to charge 1.2% of the amount borrowed rather than the 1.5% we were charged.

Anyway, what the hec, we got ourselves a fab chalet...

Hi Tad,

I agree there doesn't seem to be any catered chalets there. This maybe due to the maximum size of Chalet a foreigner can buy because of restrictions on land purchase resulting in the max number of bedrooms being 4 or possibly 5 at a push.

The area is really beautiful I know, we've been out both in the Summer and Winter so have seen both sides to Nendaz and cant wait to get back. The summer rental potential is huge and as per a post a while back I stated the average property used to rent for up to 40 weeks a year prior to their recession in the early 90's and the Swiss are returning to the Mountains with average number weeks rented currently increasing.

If you want me to put you in touch with our local constructor who maybe able to help you fulfill your dream please drop me a line through the thread A Place in the Sun lists Switzerland..... (website at top). As well as new build they may also know of re-sale properties as its KEY to buy top end property as these are what's renting out.

If you are looking to buy do it soon though Tad as the Commune of Nendaz/Veysonnaz looks like its closing down for 12 months. Also beware those offering you guaranteed rental, its a con you pay more for the property and they give you your own money back!!

Hi Nendette,

I am not familiar with re-sale but like Wolan states the 2.5% fee includes both Notaire and Canton/Federal Taxes is correct and this figure is calculated based on the total property purchase price. No Notary fees are paid on re-sale. I will drop my constructor an email now to ask if it applies to re-sale as well and get back to you.

I was talking to our Constructor this week to clarify info for a client about chalets and when a chalet is a new build you only used to be taxed on the cost of the land but this has now changed to both cost of land and Chalet and the sum of the two need to be added to your calculations.

Re the Mortgage, we got a 1.3% Mortgage registration direct with the Bank on an 80% mortgage so 1.2% is good but as we needed an 80% mortgage we were limited as these are not often given.

Thanks everyone - that's a relief about the purchase tax! Totally agree about the huge potential of summer holidays in the mountains. I was lucky enough to grow up in Geneva and we always used to spend time up in the mountains over the summer. There's nothing like it - the high alpine meadows, the cowbells in the distance, insects lazily buzzing by and scorching sunshine. And some almighty electrical storms at night - make sure you're not out alone on a hilltop! People are generally getting into the idea of healthy pursuits (and some mighty fine food) for their holidays rather than just slobbing on a beach and Nendaz is ideally placed to tap into that. For the less active there are the wonderful spas and outdoor pools all over switzerland in the summer, and high average june-august temperatures and high altitude sunshine - who needs a beach! But I'm preaching to the converted, right?

Hi Nendette,

I agree the first time you hear the Cowbells echoing through the Valleys your not sure if you are walking toward them or away its simply amazing.

The views are stunning too with great walking trails clearly marked with yellow signs to keep you moving in the direction you want. We caught the Gondola up to Tracouet walked a stretch of the Saxon Bisse in the Summer through the Forests on the hillsides and if you want a healthy tan the crytal blue skies are without a cloud in sight.

Of course you can still ski in the Summer too on the Glacier if you want!

Hi all,

I'm after a little advice really.

My wife and I would really like to get into the Catered Chalet business, somewhere in Europe.

I'm 31 and run my own refrigeration business. My wife is a performance manager for the NHS. We have a 4 year old daughter.

Does anyone have any experience in selling up, purchasing a property and starting up a catered chalet business?

I've skied and snowboarded for nearly 15 years and my desperation to get out of this Country more apparent now than ever before.

I honestly have 0 idea about where to start, the pitfalls of engaging in such a venture.

I'm not really interested in tempory "seasonal" work. This is more about a lifestyle change. Would moving with our Daughter and trying to run such a business prove impossible?

Any advice and links would be hugely appreciated.

Hi Nendette,

Really sorry for the delay in replying to your query regarding re-sale been busy with work. After talking to our constructor as you probably know by now there is a 2.5% fee even on re-sale properties which covers your taxes and notary fees. Wont be long before your there now!

Hi Mattc,

There are a few people looking at setting up catered chalets in Switzerland and you will see how long this thread has been running but there have not been any posts from those that have fulfilled their dreams as yet? Maybe you'll be the first to let us know how it goes.

Re advice purchasing a place has until recently been very simple in Valais but with the recent restrictions its making it a little trickier and nobody is sure if the pending 12 month restriction on building in certain areas will be removed in 3 - 4 months time.

Are you looking at an all year round project including the Summer? If so the Swiss law states as a foreigner you are only allowed to reside in your home for 11 months and 1 week. Suggest you take a holiday for the other 3 weeks.

Having bought in Valais last year and been both in the winter and summer if you are looking for that life changing thing its definately the place to be. The people are friendly, the food is great, weather fantastic, views out of this world and the wine which the swiss like to keep to themselves amazing!

If you want any further advice on buying a place in Switzerland go to www.alpinepropertyinvestments.co.uk as it contains a buying guide as well as descriptions of some of the villages in the region.

Thanks Topper, excellent advice as usual.

The main plan is to move wholsale and start a new home, so yes it would include both Summer and Winter seasons. Any reasoning behind the 11 months and 1 week ruling? Seems a touch odd to me.

Thanks for the advice so far, if you can think of anything else please let me know..

Mattc,
If you are going to be living out there you will need to get a permit B. Your notary should be able to help you with this. This essentially gives you the same rights as a Swiss national, in that you can live there year round - its only foreigners who do not have the right to stay 52 weeks of the year. Also, you should not have any of the problems (which have been discussed on this and other threads) regarding permission to buy, because you will be buying as a resident. We will be moving out to La Tzoumaz in 2007. let me know if you want any more advice.

TopperT thanks for getting back to me re purchase tax. Huge relief. Only 2 weeks and we'll be heading over to Nendaz, v. exciting. Our swiss-german vendors couldn't be kinder, they're currently cleaning and polishing every last door knob and have left us all sorts of appliances and fittings, imagine that in the UK!

Mattc - I know that getting the permis de sejour is getting easier all the time, at least for EU nationals. Your little girl will love it - my parents moved across when I was 2 1/2 and I can't think of a better place to grow up. Good luck in your venture.

Matt C: We've just got back after 10 days in La Tzoumaz, where the north-facing slopes are still standing-up pretty well.
If you're thinking of giving relocation a go, one idea I've suggested before, that'd be low-risk, might be to manage a chalet for a summer/winter, and then see how you get on. That way, you haven't had to sink all your savings into the exercise, and can (a) test out the economics and (b) get a good handle on what's available, build up contacts etc.

The only problem i forsee is gaining the experience needed to get a job in the first place with a Chalet rental company.

Also i have a family to think of. I'm not sure how many companies offer jobs to Husband and Wife teams with a 4 year old in tow.

I've started putting a business plan together regarding the purchase and running of a catered chalet in the Valais region. Its going to be a huge challenge to turn this dream into reality.

Tahnks for all the advice to far.

MattC: Ummm .... Renting-out a chalet to cover running costs plus some extra is one thing - a lot of the posts here are in this category. However, making enough to pay the mortgage and running costs is another. Then add-in a further profit to pay your 'salary', presumably a least £2,000/month. Plus a pension conribution. If this won't compute, then you're effecivly subsidising the exercise out of your salary/pension.
How about the idea of combining a Concierge and Chalet-boy in one job? Our Concierge gets about £15K/year and a free family apartment but also runs a separate gardening/maintenance business for chalet-owners as well. His wife runs a cleaning and laundry service (£30 a clean, £80 a laundry). They also own a chalet which they rent-out full-time ('though it may be a wider family ownership from what I can gather). All-in-all, it's probably a reasonable total income.

Your sideline could also be in catering for chalet groups who want meals provided.

I can't help thinking that for it to work, you need to do something more than just catering and cleaning for the one chalet.

Hi Mattc,
My partner and I are currently looking at a similar venture to yourself (Less the child). We too are in the early stages looking into the viability of running a catered chalet business. Which areas have you considered ? Crans Montana and Nendez seem to have the all year round potential. Are you looking to a new build or an existing property ?
Mike

MattC/MikeS,

One point I'd also make is that you need to be very realistic about what sort of Brits. rent chalets - i.e. your customer base. You meet loads of them in Verbier and they are, frankly, a fairly odious lot. Of course, they are paying a lot of money - so they expect perfection as the norm. This will NOT be a "These are our guests and this is our home"-type-situation. You are the hired help and they are the client. They pay well and expect you to be at their disposal night and day.

If you can cope with this, OK, but I think that you'd have to be fairly hard-nosed to be happy with this sort of relationship.

It seems to me that the catering is the problem. It's going to be full-time for two people to provide breakfast, afternoon tea and a slap-up dinner, perhaps with a late evening snack as well. I think that you'd have to have at least one, if not two outside staff to help with this. Otherwise, be prepared to have to work from 6am through to 1am the next morning.

I don't want to sound negative: It's just that I think that you might benefit from a year spent managing somewhere first, before you take on the additional burden of financing the exercise as well. Remember the British couple on Channel4 who set up in Chamonix? They found this out the hard way, and it wasn't until a year later, when they had got some key factors right, that it looked like things were going to work for them.