- The 5% rule: if your rent is below price × 5% ÷ 12, renting is probably the better deal.
- Under 5 to 7 years in the same home, renting is almost always cheaper.
- Buying requires a 20% deposit, half of it outside the pension fund, plus 3 to 5% of costs.
The 5% rule
Owning a home costs about 5% of its price every year, even with no rent to pay. About 3% goes to capital: mortgage interest and the return lost on your deposit. About 1% goes to maintenance. And the last percent covers taxes, charges and insurance. Compare that cost, divided by 12, with an equivalent rent.
The rule does not account for a possible rise in the property's value: steady appreciation over 20 years can change the result. It is an order of magnitude to guide the decision, not a verdict.
Prices and rents by city
| City | Price per m² | 80 m² to buy | Comparable rent | Price / annual rent |
|---|---|---|---|---|
| Zurich | ~CHF 14'000 | ~CHF 1'120'000 | ~CHF 2'800 | ~33× |
| Geneva | ~CHF 12'000 | ~CHF 960'000 | ~CHF 2'500 | ~32× |
| Lausanne | ~CHF 9'500 | ~CHF 760'000 | ~CHF 2'100 | ~30× |
| Bern | ~CHF 8'000 | ~CHF 640'000 | ~CHF 1'900 | ~28× |
2026 orders of magnitude for an 80 m² flat, monthly rent. In the big cities, a property is worth about 30 years of rent.
What buying really costs
On top of the price come 3 to 5% of costs, paid on day one and lost if you sell quickly. Transfer tax (none in Zurich, about 3% in French-speaking Switzerland), notary, land registry and a reserve for works. Then come annual condominium charges and maintenance.
The bank also requires a 20% deposit, at least half of it outside the pension fund, and a sufficient income: for a 900'000-franc purchase, about 162'000 francs gross a year. Using your pension fund is covered in our article on the pension fund and buying.
The hidden cost: your deposit stops working
Money tied up in bricks no longer earns anything else. Example: a 200'000-franc deposit, invested in the stock market rather than in property, could have more than tripled in 25 years. That lost return is a cost of buying, just like interest. On the other side, buying builds wealth through paying down the debt and any rise in price: you need to compare both paths with your own figures.
The end of the imputed rental value
Voters abolished the imputed rental value on 28 September 2025, taking effect in 2028 at the earliest. Today, an owner is taxed on a notional rent and can deduct mortgage interest and maintenance. Tomorrow, they will no longer be taxed on that notional rent, but will mostly no longer be able to deduct their interest. For an owner with little debt, that is generally good news. For a heavily indebted buyer, the effect can be neutral or even negative.
The criteria that are not financial
Duration matters more than anything: under 3 years, rent; over 7 years, buying can make sense; in between, it depends on the price and costs.
- Flexibility: a tenant leaves with 3 months' notice. A rushed sale can cost tens of thousands of francs. If your stay in Switzerland is uncertain, that weighs heavily.
- Freedom: redoing the kitchen without asking permission has a value the numbers do not measure.
- Stability: the children's school, local roots, no risk of your lease being terminated.
Going further
Indirect amortisation through the 3a. Instead of paying down your mortgage directly, you pay into a 3a pledged to the bank. You keep the 3a deduction and, while the imputed rental value exists, the deduction of interest on a debt that does not fall. With the end of the imputed rental value, the interest advantage will disappear: to reassess before 2028.
Split your mortgage. Several tranches with different maturities, or a mix of fixed and variable rates, avoid having to renegotiate everything at the wrong moment.
Negotiate the margin. Posted rates are only a starting point. Comparing three or four offers, banks, insurers and pension funds included, often saves a few tenths of a percent a year: on a large mortgage, thousands of francs.
Buy, or rent and invest?Both paths over 25 years, with your deposit, your rent and your rate.
Open the calculatorYour next step
To do, at your own pace:
Path “Tax and property” · step 3 of 5
Frequently asked questions
How much deposit do I need to buy in Switzerland?
At least 20% of the price, of which 10% in own funds that do not come from the pension fund. On CHF 900'000, that is CHF 180'000, of which CHF 90'000 outside the pension fund, plus 3 to 5% of purchase costs.
What income do I need to buy at CHF 900'000?
About CHF 162'000 gross a year. The bank calculates with a notional 5% rate on the mortgage, plus 1% amortisation and 1% running costs, and that total must not exceed a third of your income.
Can I buy property with a B permit?
Yes, your main residence. EU and EFTA nationals living in Switzerland are treated like Swiss buyers. Nationals of other countries with a B permit can buy the home they live in without authorisation, but not a second home or a property to rent out.
What costs come on top of the price?
3 to 5% of the price: transfer tax (none in Zurich, about 3% in French-speaking Switzerland), notary (~1%), land registry (0.1 to 0.3%), a reserve for works (~1%).
After how many years does buying pay off?
Usually 7 to 10 years to absorb the entry costs. Under 5 years, renting is almost always cheaper.
Is the imputed rental value going to disappear?
Yes. Voters approved its abolition on 28 September 2025. It is not expected to take effect before 2028. With it, most deductions for mortgage interest and maintenance costs will also disappear.
Sources: IAZI and Wüest Partner, 2026 property prices ; Federal Housing Office, rents ; SNB, mortgage statistics ; SBA and FINMA, mortgage guidelines ; DBG / LIFD art. 21 (imputed rental value) ; popular vote of 28 September 2025 on the taxation of home ownership ; BewG / LFAIE (Lex Koller) ; cantonal transfer tax tariffs. Prices and rents: orders of magnitude.