Selling a multi-family home: how to do it right

Many factors must be taken into account when selling a multi-family home. Thorough planning is therefore key. Comparis shows you how to make your sale a success.

1. Should I sell my property or rent it out?

Before selling a multi-family home, you should consider what would better suit your current and future life situation. Rental properties generate regular income. However, investing in renovations and modernization can quickly overstretch your budget. Managing the property entails additional costs, and any capital invested in your multi-family property remains tied up. Other things to consider include the current market situation, interest rates, and how much you expect to make from the sale.

Tip: make a list of pros and cons for renting or selling and weigh up the arguments in the context of your life plans.

If you decide to sell, you should also inform the current tenants about the upcoming change as soon as possible. If potential buyers want to view an apartment, this must be arranged in agreement with the existing tenants.

2. How can I determine the price of my multi-family property?

There are different methods of calculation. Potential buyers of an apartment building are particularly interested in the returns. Valuation is therefore often carried out using the capitalized income method.

This method compares income with expenditure. However, the market value does not necessarily correspond to the selling price. It is based primarily on supply and demand.

3. How do I go about selling a multi-family property?

Selling a multi-family home is often more complex than selling an apartment or a single-family home. There are many questions to be answered, including:

• Do I want to sell the property as a whole, or will I sell each apartment individually?

• Do I sell the property in its current condition, or is it worth renovating it beforehand?

Buyers of a multi-family house are often investors who are primarily looking for investment properties. A comprehensive and professionally designed seller’s pack is therefore crucial in order to be shortlisted.

4. What taxes and fees do I have to pay when selling a multi-family home?

Selling a multi-family property incurs certain costs. Taxes and fees vary between cantons.

• Notary fees

  Notarization of the sales or purchase contract is a legal requirement and subject to a fee. Notary fees may be up to 0.5% of the transaction value. The costs are usually shared 50-50 between the buyer and the seller.

• Land register fees

  The sale becomes official when it is entered into the land register. The authorities charge a land register fee for this. Additional costs of between 0.1% and 0.5% of the transaction price are to be expected. These expenses are typically shared between the buyer and the seller.

• Property transfer tax

  In some cantons, property transfer tax is due. The cantons of Glarus, Schaffhausen, Schwyz, Uri, Zurich and Zug do not levy property transfer tax. This tax is usually to be paid by the buyer.

• Property gains tax

  The net profit achieved through the sale of a property is subject to tax. The seller’s profit gets taxed as property gains tax. The amount depends on how long you have owned the property.

• Estate agent fees

  The actual estate agent commission depends on the type of property, the location and the sale price. In short: the higher the sale price, the lower the percentage of commission. Estate agents usually charge a commission of 2–3% of the sale price achieved. The costs for this are borne by the seller. Professional estate agents do not charge commission until the sale is complete.