Usually not freely. Under Swiss Lex Koller rules, buying residential property and renting it to private tenants does not qualify as the commercial-property exemption simply because the owner receives rental income. The decisive factor is how the property is used, not whether the buyer considers it an investment. This guide explains the rules for foreign non-residents, the difference between residential and commercial rental property, holiday homes, Swiss companies, EU/EFTA residents and the most common misconceptions foreign investors encounter.
A foreign investor may look at a Swiss apartment, calculate the rental income and conclude that it is simply another real estate investment.
Under Swiss law, however, this is not necessarily how the transaction is treated.
The Federal Act on the Acquisition of Immovable Property in Switzerland by Foreign Non-Residents, commonly known as Lex Koller, makes an important distinction between genuine commercial property and residential property.
This distinction can fundamentally affect whether a foreign non-resident is allowed to acquire the property.
Can a foreigner buy a Swiss apartment purely to rent it out?
For a foreign non-resident, generally not simply because the apartment is intended as an investment.
Swiss federal guidance specifically states that the construction, rental or trading of residential property does not constitute the type of business activity covered by the commercial-property exemption under Lex Koller.
This means that receiving rental income does not by itself turn a residential apartment into commercial real estate.
The legal analysis focuses on how the property is actually used.
Why is a rented apartment not treated like commercial property?
This is one of the most important distinctions for international investors to understand.
Consider two investments:
An investor buys an office in Zurich and rents it to a consulting company.
Another investor buys an apartment in Zurich and rents it to a family.
Both owners receive rent.
Economically, both may regard the property as an investment.
Under Lex Koller, however, the legal treatment can be very different.
The office may fall within the exemption for property used as a permanent business establishment.
The apartment remains residential property because its actual purpose is housing.
The income received by the owner does not change that underlying use.
What does the Federal Office of Justice say?
The Federal Office of Justice explains that property used for an economic or commercial purpose as a permanent establishment can generally be acquired by a person abroad without authorisation.
It also expressly states that it does not matter whether the commercial property is used by the buyer's own business or rented to a third party carrying out a business activity.
But the same federal guidance then draws a clear line:
The construction, renting or trading of residential property is not considered a business activity for this exemption.
This distinction is central to understanding Swiss foreign-property rules.
Does this mean foreigners can never buy residential property in Switzerland?
No.
That would also be too broad.
Whether a foreign buyer may acquire residential property depends on several factors, including:
- whether the buyer is legally considered a “person abroad” under Lex Koller;
- nationality;
- actual place of residence;
- Swiss residence permit;
- the type of residential property;
- whether it will be used as a principal residence;
- whether it is a holiday home;
- the canton and municipality;
- and the particular circumstances of the transaction.
The first question should therefore not simply be:
“Is the buyer a foreign citizen?”
The more important question is:
“Is the buyer considered a person abroad under Lex Koller?”
Are EU and EFTA citizens living in Switzerland treated differently?
Yes.
Nationality alone does not determine the answer.
According to the Federal Office of Justice, foreign nationals living abroad are generally considered foreign non-residents.
However, EU and EFTA nationals who are genuinely resident in Switzerland are generally not treated as persons abroad in the same way for Lex Koller purposes.
This distinction can be crucial.
For example, a Latvian, German, French, Italian or Polish citizen genuinely residing in Switzerland can be in a completely different legal position from a citizen of the same country who lives permanently abroad.
The investor's actual residence therefore matters considerably.
What about non-EU/EFTA nationals living in Switzerland?
Their position can be different.
Foreign nationals who live in Switzerland but are neither EU/EFTA nationals nor holders of a valid Swiss settlement permit may still fall within the definition of a foreign non-resident under Lex Koller.
The type of Swiss residence permit can therefore become important.
This is another reason why “foreigner” is too broad a category when analysing a Swiss property acquisition.
Nationality, residence and permit status need to be examined together.
Can a foreign non-resident buy an entire apartment building and rent the apartments out?
The fact that the buyer acquires an entire building rather than one apartment does not automatically make the investment commercial property.
If the building is primarily residential and its apartments are rented to people for residential purposes, the underlying activity remains residential rental.
Calling the transaction a “real estate business” or “investment property” does not automatically bring it within the commercial-property exemption.
The actual purpose and use of the property remain decisive.
What if I buy the residential property through a Swiss company?
This is another common misconception.
Forming a Swiss GmbH or AG does not automatically solve the Lex Koller issue.
A company registered in Switzerland may itself be subject to Lex Koller if it is controlled by persons abroad.
In addition, residential property does not become commercial property simply because a company owns it.
A foreign investor should therefore not assume that creating a Swiss company allows unrestricted acquisition of residential investment property.
Corporate structuring should be analysed before the purchase, not used as an automatic workaround.
Can I buy a Swiss apartment through several companies or shareholders?
Complex ownership structures do not necessarily change the underlying Lex Koller analysis.
Swiss rules can look beyond the registered office of a company and consider whether it is ultimately controlled by persons abroad.
Indirect acquisitions can also fall within the scope of the legislation.
For this reason, the relevant question is not only whose name appears in the land register.
The ultimate ownership and control structure can also matter.
What about holiday homes?
Holiday homes are a separate category.
Under certain conditions, a foreign non-resident natural person may receive authorisation to acquire a holiday home or accommodation unit in an aparthotel.
However, this is not an unrestricted investment-property regime.
The Federal Office of Justice states that the buyer must remain personally able to use the holiday home for its intended purpose.
A holiday home may be rented periodically, but it may not simply be rented out permanently throughout the entire year.
There are also cantonal restrictions and annual quotas.
Not every Swiss canton permits such acquisitions.
Therefore, a holiday apartment should not be confused with a normal residential rental investment.
Can I buy a holiday apartment and run it as Airbnb all year?
This should not be assumed.
A property acquired as an authorised holiday home must satisfy the conditions attached to that form of acquisition.
Federal guidance expressly states that the purchaser must remain personally free to use the holiday home and that permanent year-round rental is not permitted under this framework.
Short-term rental may also involve separate cantonal, municipal, zoning, condominium and tourism regulations.
Therefore, an investor should not purchase a holiday property on the assumption that it can automatically operate as a full-time short-term rental business.
What about serviced apartments or aparthotels?
These structures require careful analysis.
A genuine hotel operation is generally treated differently from ordinary residential rental property.
The Federal Office of Justice confirms that hotel accommodation is generally considered business premises.
However, an aparthotel may contain individually owned accommodation units subject to specific Lex Koller rules.
Similarly, a project marketed as “serviced apartments” may in legal substance still contain residential units.
The marketing description is not decisive.
The actual legal and operational structure of the property must be examined.
Can a foreign non-resident buy residential property for their own use?
Potentially, depending on the circumstances.
Different rules can apply to:
- principal residences;
- holiday homes;
- second homes;
- cross-border commuters;
- statutory heirs;
- certain family transfers.
Each category has its own legal requirements.
For example, some foreign non-residents may potentially receive authorisation to acquire a holiday home in qualifying tourist locations and cantons.
But that does not create a general right to buy residential investment property anywhere in Switzerland.
Can buying Swiss property give me residency?
No.
Owning Swiss property does not in itself create a right to a Swiss residence permit.
This point is expressly confirmed by the Federal Office of Justice.
Switzerland should therefore not be compared directly with jurisdictions offering straightforward residence-by-property-investment programmes.
Property law and immigration law are separate.
An investor who wants both a Swiss property and Swiss residence needs to analyse those two objectives independently.
Why is this different from many other countries?
In many international property markets, foreign investors can buy apartments purely for rental income with relatively few restrictions.
This creates a natural assumption that Switzerland works in the same way.
It does not.
Switzerland deliberately distinguishes between commercial business premises and residential property.
As a result, an investor resident abroad may potentially be able to buy a significant Swiss office building while not being able to freely purchase a comparatively modest residential apartment purely for rental income.
For many foreign buyers, this is one of the least intuitive aspects of Swiss real estate law.
Does a high purchase price change the rules?
No.
The Lex Koller analysis is not simply based on whether the transaction is large or financially significant.
A CHF 10 million residential investment does not become commercial property merely because it is worth more than a CHF 2 million office.
The property's use and the legal status of the purchaser remain central.
Does the amount of rental income matter?
Not for determining whether residential use becomes commercial use under this particular exemption.
A residential property can generate substantial rental income and still remain residential property for Lex Koller purposes.
This is another important distinction between economic terminology and legal classification.
An investor may call something a “commercial investment” because it produces income.
Swiss property law may still classify the underlying property as residential.
What if part of the building is commercial and part residential?
Mixed-use buildings require a separate analysis.
A building may contain:
- retail premises;
- offices;
- restaurants;
- apartments.
The existence of a commercial component does not automatically make the entire building unrestricted commercial property.
The proportion of residential use, property structure, land allocation and intended use need to be reviewed.
The competent cantonal authority determines whether authorisation is required in cases where the position is not clear.
Who ultimately decides whether the purchase is permitted?
The competent authority in the canton where the property is located.
The Federal Office of Justice explains that implementation of Lex Koller is primarily a cantonal responsibility.
The cantonal authority determines whether a particular acquisition requires authorisation and whether the statutory conditions for granting authorisation are satisfied.
For a concrete transaction, the legal position should therefore be confirmed before the buyer signs a binding purchase agreement.
Can I sign the purchase agreement first and solve Lex Koller afterwards?
This is generally not a sensible approach.
An international investor should clarify the acquisition structure and Lex Koller position before becoming contractually committed.
This is particularly important where:
- the buyer lives abroad;
- the property contains residential units;
- a Swiss company will be used;
- the building is mixed-use;
- a holiday-property exemption is being considered;
- the transaction is structured as a share deal;
- or the property has an unusual operating model.
Early clarification can avoid spending considerable time and money on a transaction that cannot ultimately be completed as planned.
Is Lex Koller changing in 2026?
A revision is currently relevant.
In April 2026, the Swiss Federal Council opened consultation on proposals to tighten Lex Koller.
Among the proposed changes are stricter rules concerning acquisitions by persons abroad, including residential and holiday-property matters.
The consultation ended in July 2026.
However, a legislative proposal must not be confused with current law.
Investors should distinguish between:
- the rules currently in force; and
- proposed future restrictions that may still change during the legislative process.
For transactions planned now, the current legal framework applies, while material legislative developments should also be monitored.
What should a foreign investor do before looking for Swiss residential investment property?
Before spending time searching property portals, travelling to viewings or negotiating with sellers, the buyer should first establish:
- where they are legally resident;
- nationality;
- Swiss permit status, if any;
- whether they qualify as a person abroad under Lex Koller;
- intended use of the property;
- whether it will be a principal residence, holiday home or investment;
- the canton and municipality;
- whether rental is intended;
- whether ownership will be personal or corporate;
- financing requirements.
This preliminary analysis can fundamentally change which properties should be considered.
How can Alpine Capital assist?
Alpine Capital and Alpine Properties advise international entrepreneurs, investors and families considering Swiss property acquisitions.
Before a residential-property search begins, we can help clarify the proposed acquisition structure and coordinate the relevant Swiss specialists.
Depending on the transaction, our work may include:
- preliminary analysis of the investor's situation;
- clarification of the intended property use;
- coordination of Lex Koller assessment;
- property search and selected direct or off-market opportunities;
- Swiss banking and financing preparation;
- corporate structuring where appropriate;
- coordination with legal, tax and notarial specialists;
- due diligence coordination;
- transaction support.
For a foreign investor, the correct first question is therefore often not:
“Which apartment should I buy?”
It is:
“Am I legally able to buy this type of property for this particular purpose?”
Once that question is answered, the search can be structured around properties the investor can realistically acquire.
Official sources and legal framework
Swiss Federal Office of Justice — Acquisition of property by foreign non-residents https://www.bj.admin.ch/en/acquisition-of-property-by-foreign-non-residents
Swiss Federal Office of Justice — Questions and answers on Lex Koller https://www.bj.admin.ch/en/questions-and-answers
Federal Act on the Acquisition of Immovable Property in Switzerland by Foreign Non-Residents ANRA / Lex Koller, CC 211.412.41
Ordinance on the Acquisition of Immovable Property by Foreign Non-Residents ANRO, CC 211.412.411
Swiss Federal Office of Justice — Revision Lex Koller, 2026 https://www.bj.admin.ch/de/revision-lex-koller
The competent authority in the canton where the property is located ultimately determines whether a particular acquisition requires authorisation. Every transaction should therefore be assessed according to the buyer's status, the property type, its intended use and the specific transaction structure.