Foreigners don’t need a residency permit to buy a vacation home here either. On average, expect to spend $400 to $500 per square foot.

Montreux is a Belle Epoque town, whose grand hotels wouldn’t look out of place on the French Riviera. An 1,100-square-foot apartment with views of the lake and Savoy Alps is priced at $356,960. Vevey has enormous cachet, too. On its “bord du lac” esplanade, a 1,020-square-foot apartment with two balconies is $458,920. On the edge of Vevey’s old town - also with lake and mountain views—a 2,060-square-foot apartment is $874,110.

Christiane of Montreux’s CGS Immobiliere speaks English. She says foreigners can also buy holiday homes in the lakeside settlements of Chexbres, Clarens, and La Tour-de-Peilz. More affordable, but you’ll still pay $43,700 to $65,560 for a small studio of 290 to 325 square feet in Clarens. In Montreux’s Terrinet suburb, a 560-square-foot apartment is $200,320. With Chillon Castle on the doorstep, Terrinet was the favorite lakeside village of “Sissi,” the Austro-Hungarian Empress Elizabeth. Like her cousin, Bavaria’s Mad King Ludwig, she also met a tragic end. On Geneva’s lakefront, a plaque marks the spot where she was stabbed to death by an Italian anarchist in 1898.

Mountain Magic

On a sunny shelf, 4,265 feet up, and home to around 3,500 inhabitants, Villars-sur-Ollon has an impressive range of summer and winter activities. The surrounding area, which includes the villages of Gryon, Chesnieres, and Barboleuse, boasts 146 ski lifts serving over 70 miles of pistes. I doubt residents swing niblicks in winter, but it even has a golf course.

Driving me around, realtor Michel Ernand pointed out the chalets of Scottish racing driver David Coulthard and Greek singer Nana Mouskouri. “Nick Faldo (the golfer) also lived here, but he sold his chalet after his divorce.” 

I also learned that Villars has two international schools. Sarah Ferguson, the former Duchess of York, considered sending her daughters to Aiglon College. However, local people were concerned about the necessary extra security, so “Fergie” left them in peace and sent the princesses elsewhere. If annual fees of $46,300 for senior boarders don’t make you flinch, you can learn more about the school at website: www.aiglon.ch.

But don’t get the false impression that Villars is snobby and exclusive. “These people could afford to buy in Gstaad, but they prefer Villars,” said Monsieur Ernand. “They go for walks, and nobody bothers them.”

While it costs around $495,400 for a new-built 1,100-square-foot chalet in Villars itself, you could buy a centrally located apartment (450 square feet) for $120,200. And Gryon (3,654 feet up) turns up cheaper options. A five-bed chalet is $386,100; one-bedroom apartments of 480 square feet sell for $87,420. 

Monsier Ernand stressed that Villars is tailored for families, not party animals. If you aim to rent your holiday home during the ski season, the most lettable properties are two-bedroom apartments in central Villars or Barboleuse. Properties of 700 to 750 square feet average $233,110 to $262,240.

Good Living - At A Price

“Where wine grows, you have good living,” said Montreux hotel director, Karl-Heinz Lukey. Agreed, but living in Switzerland is expensive. That said, it’s probably reasonable for those on Swiss salaries: even cleaners get hourly rates of around $14.50. Unfortunately, vacationers on a budget may have trouble.

One tip is to fill up at lunchtime: Brasseries and restaurants offer lunchtime plats du jour (dish of the day) for $9 to $12. However, in the evening, it’s a la carte, and prices are shocking, even in brasseries. 

For example, I found a cozy bar/brasserie in Lausanne called Les Trois Rois on rue Simplon. It’s an authentic neighborhood place where old-timers play cards. Theater posters decorate the wooden walls, and the food is superb, but boy do you pay for it. (Though not as much as in Lausanne’s cobbled Old Town or the lakeside suburb of Ouchy.)

I chose Veau Zurichois - veal slices and mushroom in cream with a potato pancake called rösti and a green salad. Price: $29. Wanting to try a red Swiss wine, I recklessly ordered a bottle of Pinot Noir. Domaine La Colombe was one of the cheapest at $28. Figuring the financial damage couldn’t get much worse, I also indulged in Efisio d’oranges (oranges swimming in Grand Marnier). That added another $9 - and most desserts cost the same.

It takes determined foraging even to find pizzas for less than $11. Average price for coffee is $2.50; for a small beer, $3.70. By small, I mean 33 cl - three mouthfuls, and it’s gone. Apart from that moment of Pinot Noir madness, I stuck to vin ouvert (open wine) from a carafe. It’s not as good, but you can find half-liters for $11. Tap water is safe, so ask for a pichet de l’eau. Bottled water can be as much as $4 per half-liter.

At Home In Switzerland?

It’s not only the high cost of living that may interfere with your dreams of a cozy mountain chalet or an elegant apartment overlooking a lake? The standard of living is high in Switzerland, the crime rate is low, and the infrastructure is fantastic…

But Switzerland’s immigration laws are tough. With only seven million citizens, the Swiss are determined to preserve their identity. A bilateral agreement with the EU means restrictions aren’t quite so rigid for EU nationals, but for others it’s difficult to get a foothold. Obtaining a residency permit allowing you to settle in Switzerland isn’t easy, especially as there are quotas. If you are over 60, don’t intend to work, have some ties with Switzerland, and can show assets of over $728,440, you may stand a chance. 

That’s not to say you cannot buy a holiday home in certain parts of Switzerland. Providing the local commune of a canton gives authorization, you, as a foreigner, are allowed to own one apartment or chalet with up to 2,150 square feet of habitable space. You can rent it out as a holiday let—and also live there yourself for three months at a time. Most non-EU nationals can stay up to six months in any one year. 

However, these are only the general Federal rules. Switzerland is divided into 26 cantons, and each has its own laws. The majority of cantons completely restrict the sale of second homes to foreigners. Buying in cities such as Geneva, Lausanne, Basle, Berne, Zug, and Zurich is prohibited. 

Depending on whether there’s a glut of foreigners purchasing property, the rules on where you can buy holiday homes are apt to change every year. Cantons that allow foreigners to buy also set quotas. Right now, the largest choice of properties available is in French-speaking Switzerland, in Vaud, Valais, and Jura cantons. In Vaud canton, you can buy in Montreux, Vevey, and some other Lac Leman lakeside towns. The mountain resorts of Villars-sur-Ollon and Verbier (Valais canton) are also open to non-Swiss buyers. A one-bedroom apartment of 430 square feet with balcony in Verbier costs around $174,840.

You can buy in parts of German-speaking Switzerland, but properties tend to be higher priced - and restrictions are usually stringent. In affluent Klosters, only three or four new-built properties are authorized for sale to foreigners each year. In Grindelwald, foreigners are permitted only to buy chalets and apartments valued over $437,090 and $582,790, respectively. But don’t even think about Zermatt—you cannot buy there at all. 

Lake Lugano in Italian-speaking Switzerland is also feasible. However, get in-depth advice. Although there are no reselling problems in Villars (buy today and sell tomorrow if you wish), some cantons don’t allow you to resell a property within five years. I recommend contacting Simon Malster of Investors in Property. This London company works with Swiss agents - they put me in touch with Michel Ernand in Villars. According to Simon, purchase fees vary between cantons, but are never more than 5% of the acquisition price. 

Rental agencies charge around 20% commission for a full management service. Rental income isn’t taxable in Switzerland, but it may be in your country of residence (and, for Americans, of citizenship). Those I spoke with, though, pointed out that, although foreigners can rent to vacationers for up to 11 months of the year, some owners barely make enough to cover taxes and expenses. 

Realtor Contacts

Investors in Property (Simon Malster), 120 West Heath Road, London NW3 7TU, England; tel. (44)208-905-5511; fax (44)208-458-5889; e-mail: sales@swissproperty.com; website: www.swissproperty.com. 
Gerance Service (Michel Ernand), Le Muveran, Case postale 90, CH-1884 Villars-sur-Ollon, Switzerland; tel. (41)24-495-3535; fax (41)24-495-3516; e-mail: office@gerance-service.ch; website: www.gerance-service.ch. 
CGS Immobilier (Christiane or director George Stam), Grand-Rue 98, CH-1820 Montreux, Switzerland; tel (41)21-962-7050; fax (41)21-962-7055; e-mail: g.stam@cgs-immobilier.ch; website: www.cgs-immobilier.ch. 

Property Tax

Annual property taxes are between 0.8% and 1.2% of a property’s value. Service charges can add another 1%. Again, the total varies canton to canton and commune to commune. 

Investors in Property cite taxes and charges for an apartment in Verbier (Valais canton) at approximately $5.10 per square foot. This also covers utilities (water, electricity), insurance, communal charges (heating, service, administration, etc.), and local property taxes. 

Vaud canton includes the mountain resort of Villars, where taxes are around $6.20 per square foot, and also the lake towns of Montreux and Vevey, where taxes are slightly higher. However, even with service charges, annual out-goings shouldn’t total more than 2.2% of the property’s value. 

Quelle Heure est-il?

I’d never heard of the concept of Internet time until I saw a $70 “Green Petal” Swatch watch. 14.58pm in Geneva...but also @582? You can spend anything from $40 to $40,000 (or more) on a Swiss watch. Need to know that Easter Sunday will fall on April 8th in the year 2987? Many timepieces are mind-bogglingly complicated - and priced to match. If you have $50,000 you don’t know what to do with, head for the Patek Philippe shop. 

The cradle of Swiss watchmaking is the Jura mountains, and you can follow a Watch Route wending from Lake Geneva to Basle. However, it was Geneva city where the horological art really flourished. After the puritanical Calvin banned the wearing of jewelry in the 16th century, Geneva’s goldsmiths and jewelers devoted themselves to watchmaking. 

Lausanne’s Art Brut Collection

Art Brut (Outsider Art) generally gets ignored by art critics - probably because it’s produced by loners, prisoners, psychiatric patients, and fringe people. Human heads drooping on flower stalks...faces composed of seashells...mythical monsters...regiments of black silhouetted figures. No space to describe all the exhibits - and a good proportion are by poor souls incarcerated in European lunatic asylums - but it’s far more rewarding than much of the stuff that critics purport to be art. The Art Brut gallery (11 avenue des Bergieres, Lausanne) is open 11 a.m. to 6 p.m., Tuesday through Sunday, and admission is $4. Bus 3 from Lausanne railway station goes there - get off at Beaulieu.

The Fashion Police

Where do traffic cops wear red skirts and high heels? In Fribourg. Don’t miss this town - it’s as lovely as Lucerne, but free of tourist hordes. Clambering high above the banks of the Sarine river, the Old Town has an eclectic mix of architectural treasures. Beside the river, look out for the covered wooden Bern bridge and the 13th-century gates that could still give any invader pause for thought. Pointy-hatted Gothic towers... frescoed houses ...fountains. Fribourg has fountains by the dozen, including one of Samson pulling open the jaws of a lion. The funicular is the easy way to get from the lower town to the upper. But hold your nose - it’s the only funicular in the world that runs on waste sewage water.

Buy Stake In A Montreux Hotel

The Eurotel Riviera is a 4-star hotel directly on Montreux’s waterfront. Prime position with all 175 rooms facing Lac Leman and the Savoy Alps. Double rooms are $168 to $220 low season; $182 to $248 high season. It’s a co-owned property - and if you’ve ever fancied having a stake in a Swiss hotel, director Karl-Heinz Lukey has an interesting proposition. 

Although recently refurbished, the Eurotel was built 37 years ago. Some of the younger generation who have inherited hotel units now want to sell. “We have owners in Brazil whom we’ve never seen,” said Herr Lukey. There are no restrictions on foreigners investing in the Eurotel Riviera. The typical unit is 370 square feet and currently sells for approximately $135,000. This gives you a 0.7% ownership in the hotel. Basically you’re owning a share in a Swiss company that happens to be a hotel. But, as with an apartment, you own the unit - it’s your name that goes into the Land Register as owner. However, units stay under the hotel’s operation: if you want to stay, you too have to pay. (Though owners do get a 30% reduction both here and in all other Eurotel properties.) 

Depending on performance, Herr Lukey says investors can expect returns of between 3% to 6% annually. The dividend, and the amount of profits plowed back into the hotel, are decided at a General Assembly each year.
Contact: Eurotel Riviera (Karl-Heinz Lukey, Directeur), Grand-Rue 81, CH-1820 Montreux, Switzerland; tel. (41)219-634-951; fax (41)219-635-392; e-mail: eurotelriviera@euriv.ch.