The city of Zürich is the capital of the canton of Zürich, situated in north-central Switzerland. The Zürich mortgages market is extremely liquid as the city is constantly ranked in the higher echelons of cities around the world in terms of quality of life. A recent report highlighted the cost of apartments in Switzerland (and in particular Zürich) and the fact that between 2007 and 2017 there was a near doubling in price. It is no surprise that Zürich was the best performer with apartment prices increasing by 97%. The price per square metre of property in Zürich now stands at in excess of CHF13,000.
At this moment in time Swiss mortgage rates are standing around record lows, which makes borrowing relatively cheap for domestic buyers. The situation is a little more complicated for overseas buyers due to the strength of the Swiss franc. When looking at the Zürich mortgage market there is often the opportunity to extend capital repayment mortgage interest rates for the full duration. This will obviously depend upon individual circumstances but as long as the mortgage capital amortises at a rate of at least 1% per annum there will be scope for negotiation.
There is a definite mix of criteria between Swiss retail banks and private operations when it comes to funding Zürich property investment. They tend to take a very different view on worldwide assets, income and security. While the vast majority of Swiss banks will require an element of funds transferred as assets under management, there is still scope to secure dry loans to buy property in Zürich. This is where we come in; we have experience with the international lending markets and our independent status means we can talk to all participants.
While domestic Swiss buyers should be able to secure attractive mortgage rates in the retail market, the strengthening of the Swiss franc has seen many overseas investors looking towards the private bank/niche lender sector. The private banking sector offers the opportunity to structure mortgage deals around a particular customer’s financial situation rather than off the shelf deals. This will dictate the type of mortgage, duration and even the currency. The use of the worldwide assets as collateral is something else which is more favourably viewed within the private banking/niche lender sector.
There is no doubt that Zürich continues to be one of the more sought-after luxury property markets. The rise in Zürich property prices over the last decade perfectly highlights this growing popularity which also reflects the lifestyle in the area. We constantly monitor worldwide mortgage markets, Zürich being of particular interest to many of our clients, and have built up some strong relations with local and international lenders.
Foreign buyers need to be aware of the local authorisation required when looking to acquire property in Zürich, and the fact it can change from canton to canton, but we are fully aware of the regulations. Our ability to incorporate local regulations with domestic and international mortgage finance has paved the way for many local property purchases which may initially have seemed impossible. So, why not give us a call today for a no obligation chat about your particular situation, plans for the future and options available to you.