Swiss Federal Supreme Court Renders Guidelines On Abusive Construction Of Secondary Holiday Residences

Author:Ms Dominique Berther
Profession:Rihm Attorneys

A popular initiative vote of March 11, 2012 led at the beginning of 2015 to the enactment of the Swiss Federal Act on Secondary requiring communities in Switzerland to limit secondary holiday residences to 20 percent, therefore making the more or less unlimited primary market of home construction much more attractive.

In January 2018, the Swiss Federal Supreme Court (SFSC) had a chance to render a first judicial precedent for the Community of Verbier in the Canton of Vaud by saying that the demand for first homes in the community was insufficient and that the construction project under dispute could only be approved if serious and concrete assurances of future ownership by year-round permanent residents could be demonstrated prior to construction. The highest court in Switzerland furthermore considered it problematic to authorise the construction of residences most probably never to be used as primary residences.

Finally, the SFSC ruled that the location of the property, i.e. the building zone, year-round accessibility, the distance to potential workplaces, the structural design of the apartments regarding a year-round use, the price and the circumstances of the person intending to live there (current place of residence and work, intentions to move) must be taken into account. If the future residents are not known, the demand for first homes would become the main criterion test.

Now, in a further decision of December 3, 2018, in a construction project in the legendary Gstaad Region, the SFSC refined its practise by including the purchasers' potential desires to use a home in the primary market as a secondary residence at a later date, calling the planned construction project abusive and therefore unlawful.

The Community of Saanen nearby Gstaad approved a project to build three houses with a total of twelve 3- and 4-room apartments in the upmarket and luxury segment, respectively. In 2014, the Construction, Transport and Energy Directorate of the Canton of Berne approved a complaint by opponents and referred the matter back to the community in order to further review the project. After the...

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