We've been looking for our next home for several months now.
It all started as a bit of dream to finally get our French home. Before arriving in Basel, we were already on the hunt for that perfect home (whilst laughing at the ridiculous nature (design/price) of the Swiss real-estate).
We were determined that all the reasons to live in France were good:
- good health care;
- good school and preschool system (and affordable);
- comparatively affordable housing (i.e. in-demand areas approximately 1/2 the price of the Swiss counterpart);
- possible lower taxes;
- earning CHF while spending in Euros (current economic factors);
- French way of living;
- French food & drink
Well, the things we didn't take into consideration were:
- taxes in an additional country;
- it's not easy to live in a country you're not earning in (tax wise & legal implications);
- social isolation of a village in France vs. excellent expat factor in a multi-national place like Basel;
- Basel is CONVENIENT;
- Once you're in the Swiss system, it flows smoothly. Dividing yourself over countries essentially puts you at a loss in so many aspects important to us except maybe financially.
So then we toyed with the idea of purchasing in Switzerland. Cough cough ~ it's outrageous:
- People price property how they want (not value since the economy is so stable) and wait and wait, and wait and wait. They don't care how long it takes to sell. It has no bearing on value or state of (ill) repair;
- Downpayment can be prohibitively expensive (20% or more);
- purchase is more of a long term life style choice rather than an investment;
- and the design of most places is.... well foreign to anything I know to be right and practical and good.
For example:
- 2 washrooms should not be placed right next to each other unless they service completely different areas. The way we've often seen it laid out, you can pick a toilet when the time comes as they are right next to each other. "Eeny-meeny-miny-mo" style. It seems that plumbing would be the only practical reason to put them near each other. Then there is some other funny stuff:
- having bedrooms off the dining or living room seems... impractical much like having a bedroom off the kitchen... And if we're going to do an ensuite w/c, for pities sake, put the door to the w/c in the bedroom, not in the hall outside the room. Otherwise, by definition, it is NOT an ensuite!
- front door into living room...
- bathroom with balcony...
I digress.
And like I mentioned before, people price how they want - if they feel sentimental about a kitchen they've had while raising their children 2 generations prior, so be it. It's still going to cost you! And it doesn't mean you get a good deal on the house, renovate and eventually recoup your investment. Unless you're really lucky.
And since design is so random here that the chances are, you WILL need to renovate after paying full price for a shall I say... a
shabby? house.
Once you've purchased and renovated your house to your liking you now have the privilege of paying real taxes on the imaginary rental income you would earn if you would rent the entire property out (even if you're living in it, paying your first mortgage* and have
zero tenants to share your burden).
Lastly, since we're not Swiss we'd have to sell our property within a year if we left the country. This is not necessarily easy if you want to recoup the purchase price (and remember, you're not likely to make a profit) especially selling "quickly" in a chilled-out market.
So, Switzerland, we've been deterred from ownership. For now.
In conclusion, we're like everyone else looking and looking for that perfectly balanced rental. A funny market in it's own right. Like many rental markets there are quirks. You have to note though, that no matter how modern and cool an apartment is, design is still everything. The new places are just as liable as an old place to be ugly or poorly laid out or simply poorly designed in its entirety. Such a strange waste! Note: there are some nicer gems - we simply can't afford it (or they're geographically inconvenient).
We have found a couple of places we like (weighing drawbacks against each other) and will probably make a decision soon. Perhaps once we've been here for a while, after we get the lay of the land (Basel Land to be precise) we will consider purchase. We'll see!
*Housing can be so expensive that in order to pay a reasonable monthly mortgage it's common to have a second mortgage and a "third pillar" an RRSP type investment. It works, it's just different than we're used to. Your mortgage is amortized over 25 years**. You pay reasonable, regular payments and any surplus you have goes into the tax sheltered third pillar. When you hit retirement age, you've paid your 1st mortgage and you can probably pay off your 2nd mortgage with the 3rd pillar investment. So essentially, you are doubling-up your mortgage payments monthly and 50% is held in a tax sheltered investment.
**A good thing: When you negotiate your mortgage period (25 years) it stays at 25 years. Interest rates can change or be renegotiated over time, but your amortization horizon won't change. This means you don't pay as much interest as when constantly re-negotiating the amortization period of your mortgage as it's done in North America. Thanks again Banks.
