What should investors know before acquiring real estate in Switzerland?

Explore the legal technicalities and pitfalls of investing in commercial real estate in Switzerland.

In brief

• Real estate transactions in Switzerland involve multiple steps, including due diligence, legal review and often notarization to ensure compliance and minimize risks.
• Foreign investors face specific legal restrictions and all parties must consider tax, financing and regulatory factors.
• Success hinges on the anticipation of the transaction’s critical milestones and on collaborative support at every stage.

Swiss commercial real estate – a safe and easy bet?

Switzerland’s real estate market is one of the most stable and tightly regulated in Europe. With its reputation for legal certainty, strong institutions and high demand for prime assets, commercial property attracts both domestic and international investors. Our 2025 EY Trendbarometer study for the real estate investment market shows that 93% of investors rated Switzerland as attractive or very attractive for real estate investments in 2025. We expect this trend to be even more pronounced for 2026.

Unlike in many other countries, ownership rights in Switzerland are rooted in a highly reliable public land register. This register provides precise and enforceable evidence of ownership, easements, liens and usage rights. That legally enshrined reliability, combined with the country’s political stability and low interest-rate environment over much of the past decade, has made Swiss commercial property an attractive and relatively safe asset.

Still, “safe” does not mean “simple.” Transactions involve a complex series of legal, financial and administrative steps that vary by canton and often require coordination between brokers, lawyers, notaries, lenders and tax advisers as well as the buyer and the seller. Excepting EU and EFTA member state nationals, foreign investors must also navigate restrictions under Lex Koller (the Federal Act on the Acquisition of Immovable Property in Switzerland by Foreign Non-Residents), which regulates foreign ownership of Swiss property.

For investors, the key is preparation. Understanding the financing options available, how Switzerland combats money laundering and how to manage the end-to-end transaction process is essential to ensure compliance, minimize risk and avoid costly delays. In the following, we focus on a selection of critical considerations for investors in the domains of financing and compliance, followed by a closer look at the process of buying and selling property in Switzerland.

Financing

Financing structures in Switzerland typically hinge on the use of mortgage-backed lending. For commercial acquisitions, buyers often combine equity with secured loans issued by Swiss or international banks. The loan is normally secured by a mortgage note (“Schuldbrief”), which is registered in the land register alongside the property deed. There are several aspects of mortgage notes and security that investors should be aware of.

Key financing documents typically include:

• Secured term loans for properties
• Development or construction loans for projects requiring upgrades or new construction
• Assignment of claims agreements where rental income or receivables are pledged to the lender

The buyer’s counsel must coordinate closely with the lender’s counsel and with the notary to prepare these documents, negotiate lien waivers and ensure regulatory compliance.

Buyers and sellers negotiate who bears notary, land register and bank fees. Usage differs across cantons: in the majority, the buyer typically covers all expenses associated with the acquisition, including notary fees. However, in some cantons, the parties may agree on a proportional sharing of these costs. Notary fees and charges associated with the registration of the deed (registry fees) are generally determined by cantonal regulations. In most cantons, a transfer tax is levied (calculated on the purchase price, sometimes also taking into account the cost of a work contract if such contract is closely linked to the real estate transfer).

Because Swiss financing law interacts closely with cantonal regulations and the federal land register system, foreign investors in particular should work with experienced local counsel to avoid missteps.

Anti-money laundering

Switzerland maintains a straightforward anti-money laundering (AML) framework, reflecting both domestic priorities and international obligations. The two core legal instruments are the Swiss Criminal Code (SCC), which prohibits money laundering, and the Anti-Money Laundering Act (AMLA), which imposes due diligence obligations on financial intermediaries such as banks, asset managers and insurance companies. Under AMLA, financial intermediaries must verify the identity of clients and beneficial owners, clarify the economic background of transactions that appear unusual or complex and report any suspicion of money laundering or terrorist financing without delay. They must also maintain records for at least ten years.

Under the SCC, any person who conceals the criminal origin of assets can face fines of up to CHF 1.5 million and up to five years of imprisonment. Serious cases involve organized crime, large sums or professional laundering.

One of the main implications of anti-money laundering rules for real estate transactions is the requirement to review the origin of funds used for the transaction. Large cash payments, in particular, may face scrutiny and have become increasingly rare.

The Swiss Parliament voted for a proposed revision to the AMLA in September 2025. It significantly expands the current scope of the AMLA by introducing the concept of “advisors.” These include individuals and entities that professionally assist third parties in financial transactions related to legal operations such as buying or selling real estate, creating or managing non-operational legal entities and providing domiciliation services. Advisors will be subject to due diligence obligations similar to financial intermediaries, including client identity verification, beneficial ownership identification and documentation retention. Exceptions apply for low-risk transactions, such as family-related transfers, residential purchases for personal use and property deals under CHF 5 million processed exclusively through regulated financial institutions.

The revision, which aims to reduce misuse of real estate for money laundering and tax evasion, especially through shell companies or complex ownership structures, may still be subject to a referendum, which could lead to a popular vote on the matter. If adopted, this amendment would tighten compliance requirements for professionals involved in real estate transactions, such as notaries, advisors, fiduciaries and possibly brokers. Overall, the real estate sector would face stricter scrutiny, aligning Switzerland with international AML standards.

The transaction process

Buying and selling commercial real estate in Switzerland through an asset deal follows a structured workflow designed to ensure legal certainty. Each stage involves external professionals whose expertise is indispensable.

Special considerations for foreign investors

Foreign investment in Swiss real estate is subject to the Lex Koller, a federal law that restricts the acquisition of residential property by non-residents (“persons abroad”) but generally permits the purchase of properties which have a purely commercial purpose (office or industrial buildings, hotels, etc.).

The rules apply not only to foreign individuals but also to Swiss companies that are controlled by foreign investors, which are treated as foreign buyers under the law. In this respect, a person abroad is considered to hold a dominant position in a Swiss entity when, due to the size of their financial participation, voting rights or other factors, they can exert a decisive influence over its administration or management. This is presumed if foreign persons own more than one-third of the share capital, control more than one-third of voting rights, form the majority of board members or foundation beneficiaries or provide repayable funds exceeding half of the entity’s net assets. Similar rules apply to partnerships, real estate funds and SICAVs, where foreign control over management or significant financial leverage also establishes dominance.

There are important exemptions. Citizens of EU and EFTA member states who are legally domiciled in Switzerland are not considered foreign investors for the purposes of Lex Koller and therefore enjoy the same property rights as Swiss nationals.

Compliance is critical: transactions that violate Lex Koller may be declared null and void, and intentional breaches can result in criminal liability.