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In Switzerland, most people rent their apartments or houses. The reason is that access to real estate is quite complicated. But renting is not much simpler. If you want to rent in Switzerland, there are many things you need to know. You will be better prepared and protected if you learn about this subject.
For instance, did you know that rent prices are indexed on a reference interest rate? If the rate goes up, so does your rent. But if the price goes down, you are entitled to a reduction. But you have to ask for it!
Other subtleties are essential to know when you are renting in Switzerland. For instance, there are many things you need to know about giving back your apartment. This article covers all these critical points.
How to find a property to rent?
Finding a property to rent in Switzerland is relatively easy.
It may take a while if you are extra select about your choice. But otherwise, there are enough properties available that you can find something for you. And some cities are more filled than others.
There is one exception to that. It is difficult to rent a house in Switzerland. Finding an apartment to rent is straightforward. But finding a house is much more difficult.
An online platform will be the best solution for most people to find the apartment or house they are looking for.
There are three primary online services for finding properties to rent in Switzerland:
The one you choose does not matter much. All these platforms are gathering properties from the other platforms. So you will find almost the same properties on each platform. And often, you will be redirected to another platform to get all the information and pictures.
I will not go into how to choose a property. It is personal, and everybody has a different view on which property they want. You should choose an apartment or house that suits your needs and budget. And if you want to save money, you should be reasonable with the number of rooms you plan to get.
How to apply for a property?
You found a property you are interested in; you need to visit it now.
During the visit, make sure to ask as many questions as you want to the tenants. Most of the time, the previous tenants do the visit themselves, not the building managers (or landlords). Since they lived there, they are most helpful in answering your questions. You also need to make sure to check the details. If you are visiting with the tenants, do not forget to ask how much they are paying. It is essential because it may not be the price you found online.
After the visit, if you like the property, it is time to apply. In most cases, you can directly give the application details to the tenants or building managers after the visit. Sometimes, you must send the details to the property managers (or the landlord).
In some cases, you will have to fill out an application form. And you will even have to pay to deposit your application, for instance, in Geneva. But in Fribourg, it is simpler and free!
Since properties are generally given on a first-come-first-served basis, you should visit a property and apply for it as soon as possible. If you are in a market with a lot of competition, you can expect to be refused a few times before getting the apartment you want.
The documents you need depend on the building managers or the landlords. But generally, you will need to provide at least these documents:
- Your last three salary certificates.
- A document proving that you are employed.
- A copy of your passport or identity card.
- A document showing that you do not have unpaid debts (Extrait du registre des poursuites in French). You can obtain this document online in your state office.
- A document showing that you have no criminal record. You can obtain this document from your local police. This document is optional.
- Information about your age, marital status, children, and pets. This information is not always required but will sometimes be asked of you.
In some cases, you will even have to write a motivation letter. It does not happen often. But in some real estate markets, this is required. And sometimes, it could help if there are many applicants for the same property.
Once you have given all these documents to the landlords or managers, you have to wait until they give you their decision. If you do not get it, you will have to redo it again. Most of the time, the property is assigned on a first-come, first-serve basis. So, you need to be reactive.
If you got it, it is time to go to the next step.
Sign the lease
If your application has been accepted, you will have to sign the lease. Only after you sign will the rental contract be complete.
You should read the lease in its entirety. There may be some weird things. First, check the rent price; it must be precisely what you agreed on before.
You should also check the period of the lease. Usually, it should be 12 months, renewed for 12 months. And you should probably check when you can exit the lease. Some leases are very constraining.
If you have the price the previous tenants were paying, you can also compare these two. In Switzerland, landlords cannot increase the rent price without good reason. They could justify a few percent by the increased cost of life in Switzerland. But if they did not significantly improve the property, they cannot increase the price significantly. And some works are simply maintenance work. For instance, they cannot increase the price if they redo the paint.
If you see something that does not make sense contact them, and if they do not appear honest, do not sign the lease. If you want help with that, I would recommend contacting the ASLOCA. The ASLOCA is an association for tenants, and they can be accommodating in mediating bad situations.
After you sign the lease, you still have 90 days to fight some of its points. But if you disagree with the lease, it is better not to sign it.
Do not fall for Swisscaution
After signing the lease, you will have to prepare a deposit. The deposit is generally three months of rent. But this can be more or less than that. In some cases, some landlords without building managers will not even ask you this. But this is a rare case.
Generally, you can put this money into a deposit bank account. This bank account will be in your and the landlord’s names and tied to the lease. You can only get back this money once you leave the apartment, and during your stay, it will stay dormant.
If you damage the apartment, the landlords can use this money to cover the damage. You can get back this money if nothing bad happens once the lease is over.
Now, there is another alternative: Swisscaution. But Swisscaution is a bad alternative. With them, you do not have to deposit much money in a bank account. Instead, you will pay a yearly fee based on the rent price. For instance, you may pay 300 CHF per year for a 1300 CHF monthly rent.
And if there is a problem, in the end, they will cover the fees. However, you will then owe them the fees back. So, in the end, you pay for nothing!
If you rent the same apartment for ten years, you will pay 3000 CHF to SwissCaution. And at the end of the lease, you will not get anything back. With a bank account deposit, you will receive your three months of rent at the end!
One may argue that if you were to invest the money instead of depositing, it could be beneficial to use Swisscaution. However, this makes it much more complicated and ignores that most people will not invest this money. For such a small amount of money, this is a useless optimization.
So, always opt for a bank account rental deposit, and never opt for Swisscaution.
How to choose a bank account for a rental deposit?
Sometimes, you will have to choose in which bank you will deposit your rental deposit.
Almost every bank in Switzerland offers this kind of account. These accounts are great for them since the money will stay untouched for a while. In most cases, however, the building managers choose it for you.
The first thing you should do is only consider free accounts. Some banks are costly to offer these kinds of accounts. For instance, you will pay 20 CHF to open an account at UBS. Given the low interest rates, you will never get it back. And you also have to look at closing fees. The one I had at BCF cost me 30 CHF to close. This fee is six times more than the interest I received when I had this account. However, the building managers did not give me any choice for this account.
Then the second thing you need to look at is the interest rate. Since you take a free account, you must choose the account with the highest interest rate. This interest will not be much, but this is better than nothing. For instance, Credit Suisse has a 0% interest rate, Migros has 0.01%, and Bank Cler has 0.025%.
Given the current state of banking in Switzerland, you will not get an excellent interest rate. So getting the cheapest account is the most important.
The next step in your rental adventure is to visit the apartment to check its state. It is an important step. At this point, the previous tenant will have left and cleaned the apartment. At the end of the visit, you will have to sign a handover document about the apartment’s state when you take it.
You should be careful about this. If you see something amiss in the apartment, ask for it to figure out on the document. For instance, if the floor is broken or the paint is scraped, these facts should figure out in the document. If there are no lights, make it appear as well.
You should test all the equipment in the house, including faucets, lights, and blinds.
You must be thorough with this step because you will do it again when you leave the apartment. At this point, the landlords will compare the state, and if some defects are new, you will have to pay for them. If you forgot some defects in the first visit, some managers could try to pin them on you.
Usually, they should give you a copy of the handover document. Make sure you keep this well. If you are paperless, make a copy of it and store it safely. It is good to have it when you leave the apartment.
Pay your bills
Now, you are done with all the steps: you can enjoy your apartment!
The only thing you need to do is to keep paying your bills. And make sure to keep your apartment in order if you do not want to pay fees for defects when you give it back.
But you need to know a few more things after moving to your apartment. And some of these things can help you save money on your rent.
Reduce your Rent – Reference interest rate
In Switzerland, rent prices are indexed on a reference interest rate. If the reference rate goes up, so does your rent. And if the rate goes down, your rent should decrease too! The rate is updated every three months.
However, there is something awful about this system. Rent decreases are not automatic. You need to ask for them. Since many people do not know about it or do not want to do it, they pay way too much. This system is stupid. But we have to live with that.
If the reference rate increases, your rent price will also go up. In that case, your owner or building manager will soon send you a letter to let you know of the increase.
Only the rent price is indexed on this reference interest rate. The second part of the price is the charges (heating and water, for instance). This second part is not indexed, and you cannot get a reduction on that part. Also, it is not possible to get a retroactive reduction.
Usually, the owner cannot refuse you this reduction. However, there are some exceptions. If the owner can prove the building’s maintenance costs have gone up, it can use that to offset the reduction. And if there were some improvements to the quality of life in the property (not fixes, real enhancements), the landlord could also use this.
Some people are also afraid to get into trouble with the building manager or the owner if they ask to reduce rent. But a building manager cannot put you out just because you ask for a rent reduction. This reduction is something you are entitled to, and there is no reason to give them more money than they should get.
Ask for a rent reduction
So, if the reference rate goes down, you should ask for a reduction in your rent. You are entitled to it, and there is no reason not to do it. And even if the rate did not go down recently, you can still ask for a reduction if your rent was set with a higher reference rate.
Many people are eligible for many years of rent reductions. And many people still do not know about that!
The ASLOCA has a great calculator for this case. This calculator will let you know how much reduction you can ask for. And it will also directly generate an example letter you must sign and send to your landlord or building manager.
Remember that you can only ask for a reduction for the next lease exit date. Most leases have two exit dates per year. For instance, our previous lease let us leave in March and September. And you need to ask within the delays set by your lease again. There is no way to get a reduction for the past months. So, the more you delay, the more you lose money.
I have already done this several times. And each time, I was able to get my rent price reduced! Doing so is a great way to save money! And you are entitled to the reduction.
Know your rights
Even though I am not a fan of the Swiss laws for tenants, there are still a few good things. Tenants have rights. And it is helpful to know them if you want to be protected.
Abusive rent increase
One good thing is that tenants are protected against abusive rent increases. A landlord cannot increase rent without reason, and the owner has to give you the reason when he wants to increase the rent.
For instance, if the landlord redoes the paint after ten years, he cannot increase the rent. Or if he improves the insulation of the house, that is not a reason either. You need to improve the quality of the property to be able to increase the rent.
The other reason is if the cost of living increases. Then, it is reasonable to increase the rent in accordance. And the same applies if the reference interest rate increases. In these cases, there is not much you can do.
Temporary reductions of rent
Another good thing: tenants are entitled to temporary reductions of rent in some cases:
- If your landlord is doing construction work on the house, you can ask for some reduction during the construction.
- If you lose access to some parts of your apartment for some time, you can also ask for a reduction.
- If you lose access to the bathroom, you can ask for a significant reduction.
- If you lose access to the kitchen, you can also ask for a significant reduction.
Unfortunately, there are no direct rules about how much you can get. You will need to research existing cases.
Here are some examples (here in French) I found:
- Apartment too cold: 20% reduction.
- Dishwasher not working: 3% reduction.
- No elevator on the fourth floor: 10% reduction.
- Noisy restaurant on the floor below: 20% reduction.
- Intrusive construction work in the building: up to 30% reduction.
You should not hesitate to ask for a rent reduction. And if you feel you did not get as much as you deserve, you can contact the ASLOCA to get some help.
Once, there was water leakage in my apartment, and the walls needed to be dried up, with noisy machines in my apartment. I asked for a 15% reduction and got it.
Give back your apartment
At some point, you will likely give back your apartment to move. There are two different options for giving back your apartment:
- You give it back at the term of the lease.
- You give it back at any other time.
If you give back your apartment at the term of the lease, you have to respect the delays of the lease. If you send your letter on time, you can leave your apartment at the correct time. And then, you will only need to hand over the apartment.
However, most leases in Switzerland are terrible, and they are all in favor of landlords, not tenants. Generally, you will have only two dates during the year when you can leave the apartment. And you will have to send your letter three months in advance. So, the chances you can give back your apartment on time are almost null!
You can still give back your apartment at any time under some conditions. It is what happens most of the time. In that case, you will have to find yourself a new tenant. You are doing what building managers and landlords should be doing. And you are doing their job for free!
You will have to find at least one tenant that is solvent. He should have no debt and enough income to rent this apartment. If you find one such tenant and if he signs the lease, you are free to leave your apartment. If the building managers refuse a solvent tenant for other reasons than its solvency, you are also released of your obligations.
If you do not find another tenant, you will have to continue paying your rent until your lease’s official term. It can be a long time, so you need to be careful when switching to a new apartment! You may have to pay for both apartments for several months.
Exit handover visit
Once you have settled on an exit date, you must recheck the apartment’s state. You will have to clean the apartment thoroughly. Most people do that themselves. But some cleaning companies will do that for you. It is up to you to decide if you want to spend time or money.
And then, the managers (or the landlord) will visit it with you. If something is broken, you will have to pay for the repairs. You are fine if the defect was already there when you visited and appeared in the entry handover document.
If you know you broke or damaged something, you should fix it before the visit. That way, you will save time.
Some managers and landlords will try to make you pay for things you did not do. For instance, many will try to make you pay for repainting the apartment. In most cases, this is not justified. The landlords need to do some things. For instance, they need to fix everything that is normal wear.
If something is not normal wear, for instance, deep scratches on the floor or walls, you will have to pay for it yourself. You can also sometimes fix it yourself if you can. Most of the time, the landlord will send you the bills. Once paid, the landlord will free up the rental deposit.
If nothing needs fixing, the landlord must release the rental deposit once the exit handover document is signed. They will have to give you a letter showing that the rental deposit has been released. Then, you can go back to the bank and get your money.
As you can see, renting in Switzerland is not a simple subject, and many things are essential to know. If you do your research correctly, you will avoid bad situations.
The worst about this system is that many people do not know their rights. As a result, many people are paying a higher price than they should. It is estimated that people are paying several billion CHF too much every year.
Knowing about the reference interest rate is very important for tenants. So, do not hesitate to ask for a reduction in rent price if you are entitled to one.
Also, consider your lease terms when you plan to switch to a new apartment. You do not want to pay for two apartments for several months. Finally, do not even consider Swisscaution!
If you are also interested in buying, I have another article about buying a house in Switzerland.
Do you have any other tips for renting in Switzerland?
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