Switzerland plans further restrictions to buying real estate

Switzerland Tightens the Reins: Proposed Amendments to the Lex Koller

Following the decision in 2025 of the Swiss Federal Council to introduce more restrictions on the purchase of real estate in Switzerland by foreigners, the Council has now published a comprehensive set of proposed amendments to the Federal Act on the Acquisition of Immovable Property by Foreign Non-Residents, commonly known as the "Lex Koller.” 

While it was initially unclear how far the changes would reach, the proposal represents a significant tightening of the rules governing foreign real estate ownership in Switzerland. Below we have prepared an overview of the key proposed changes.

Commercial Properties: End of Pure Capital Investment

The proposed amendments include restrictions on purchases of commercial property. Currently, the purchase by foreigners of immovable property that serves as the permanent establishment for a trading, manufacturing or other form of commercial operation does not require an authorisation. Under the proposed changes, foreign buyers would only be permitted to acquire commercial properties (Betriebsstätte-Grundstücke) for their own direct business use. This would effectively end the current practice of acquiring such properties as a pure capital investment, including for the purpose of renting or leasing them to third parties. 

Moreover, according to the proposal, if the owner ceases to use the property for the stated business purpose, it must be sold within two years. Where mandatory residential zoning requirements (Wohnanteilsvorschriften) apply, the co-acquisition of residential units on such commercial plots would be capped at one third of the gross floor area. 

Listed Real Estate Companies, Real Estate Funds and SICAV

In a further tightening, the acquisition of shares in residential real estate companies listed on a Swiss stock exchange would once again be subject to an authorisation requirement, effectively amounting to a near-prohibition for persons abroad, given the very limited grounds on which authorisation may be granted. 

Likewise, the current exemption for regularly traded units in real estate funds (Immobilienfonds) and real estate investment companies with variable capital (Immobilien-SICAV) would also be abolished. 

These limitations would even apply if just one single share of a real estate company or a single unit in a fund or SICAV is purchased. While the proposal does not include a retroactive effect and the limitations would, therefore, not apply to persons abroad who already own shares or units, trading such holdings may become difficult if the proposed changes were to pass, as they cannot be sold to persons abroad.

Preventive controls involving stock exchange participants and fund management companies would also be introduced to enforce these new restrictions.

Primary Residences: New Authorisation Requirement and Obligation to Sell

Perhaps the most consequential change for prospective new residents is the proposed re-introduction of an authorisation requirement for the acquisition of a primary residence (Hauptwohnung) by third-country nationals. These are nationals of countries outside the EU and EFTA (which includes the US, Latin America and Asia) who hold a B residence permit. While currently, such individuals may purchase a home for personal use without requiring a permit, under the proposed regime, an authorisation would be required. 

Critically, the proposed amendments also introduce an obligation to sell the property within two years if the owner ceases to use it as their primary residence — for instance, upon relocating abroad, moving to another municipality in Switzerland, or moving to a different property within the same municipality. Failure to comply with this obligation could ultimately result in a forced sale and forfeiture of any profits to the canton. To enforce this rule, the draft bill explicitly proposes that local authorities (Einwohnerkontrolle) be required to report any changes of address by relevant foreign nationals to the cantonal authorization authorities. 

It is important to note that EU and EFTA nationals with legal and actual residence in Switzerland are not considered "persons abroad" under the Lex Koller and would therefore not be affected by this particular restriction. Similarly, third-country nationals holding a C settlement permit are exempt from the authorisation requirement entirely. 

Holiday Homes: Reduced Quotas

The maximum nationwide quota for annual cantonal permits for the acquisition of holiday homes and residential units in apart-hotels by persons abroad would be halved from 1,500 to 750, of which only 600 would be available for distribution to the cantons that currently provide for this type of acquisition. Transfers of holiday homes between foreign nationals — currently exempt from quota charges — would once again count against the cantonal quotas. 

Legislative Process and Outlook

The public consultation on the draft bill runs until the 15th of July 2026. Following the consultation, the Federal Council will present a formal bill to Parliament. The timeline for parliamentary debate and potential entry into force remains open, and the implementing ordinance (BewV) will need to be revised in parallel. 

While it should be noted that all proposed restrictions are intended to remain within the framework of Switzerland's existing international obligations, in particular the Agreement on the Free Movement of Persons with the EU, the changes are substantial and still contain several ambiguities that require clarification. Serious questions also arise regarding the implementation of the proposed changes. 

It has yet to be seen what results from the consultation process. However, for international investors and high-net-worth individuals considering investing in or moving to Switzerland, the message is clear: the window for acquiring Swiss real estate under the current, more permissive regime, may be closing. Therefore, it is best to act sooner, rather than later. We will keep you updated as the legislative process progresses.