Renting out your apartment privately: Here’s how it works

Private landlords are in a strong position

If you want to rent out your own apartment privately, you’ll soon be faced with a whole range of questions: Am I allowed to rent out my apartment myself? What do I need to consider if I want to let a condominium? What responsibilities come with it?

First things first: Yes, renting out your own apartment as a private individual is allowed in Switzerland – and it remains a highly attractive opportunity. Despite steady population growth, less and less new housing is being built across the country. According to the Federal Office for Housing, Switzerland is short of between 5,000 and 10,000 apartments every year.

This shortage is particularly noticeable in urban areas and has led to rising rents in recent years. In other words, the timing to rent out your apartment yourself couldn’t be better.

Property management by fiduciary or real estate companies

Many property owners choose to have their apartments managed by a real estate or fiduciary company. The main reasons? A lack of time and the specialist knowledge needed to handle rentals on their own.

However, professional support comes at a price. Third-party management typically costs around 4 to 6% of the rental income. The exact fee depends on the scope of services, the number and age of the rental properties, and the region where they are located.

Management companies take care of a wide range of tasks, including:

• Rental income monitoring
• Property accounting
• Service charge statements
• Balance sheets and income statements

They also handle the technical management and maintenance of the property. On top of that, they search for suitable tenants, conclude rental agreements, and manage rent adjustments. Requesting quotes and awarding contracts to tradespeople also falls within their responsibilities.

Renting out your apartment privately – what to expect

A look at what property management companies typically handle shows just how much work goes into administration, maintenance, accounting, and finding and supporting tenants.

That said, homeowners who want to rent out their apartment privately can absolutely take on these tasks themselves. You’ll need a good head for numbers, a basic understanding of legal matters, and enough time to manage everything properly. With the right software, practical guides, and legal advice from a homeowners’ association, keeping things under control is very doable.

In general, managing a single apartment is far less time-consuming than running a large multi-family building. Newer properties also tend to require less effort and are usually cheaper to maintain than older buildings, where repairs are more frequent.

One thing is clear: if you manage the property yourself, you’ll need to deal with accounting, service charge statements, taxes, tenancy law, and tenant concerns.

A helping hand: Support from a caretaker

If you’re renting out several apartments without using an agent, it can make sense to hire someone for caretaker tasks – either on an hourly basis or for a flat fee.

It’s your responsibility to register this person with the AHV (Old Age and Survivors’ Insurance) and to take out accident insurance. Depending on the insurer, the annual cost is around CHF 100.

Make sure your caretaker has a clear job description outlining all tasks, rights, and responsibilities of both parties. And if you’d rather leave the property accounting to a professional, you can of course delegate this to a fiduciary company.

Manage your apartments privately with software

Struggling to keep track of the administrative and financial side of your rental properties? Then property management software with integrated accounting could be just what you need. Solutions designed for private landlords without in-depth expertise are available for just a few hundred Swiss francs per year.

Not sure if a specific tool is right for you? We highly recommend trying a demo version. It’s the easiest way to see whether the software meets your expectations and fits your needs.

One of the biggest advantages: service charge statements become much simpler. The software helps you allocate electricity, heating, cold and hot water, and other ancillary costs proportionally and correctly.

Additional key features often include property management functions and ready-to-use documents such as rental agreements or handover reports.

Some programs also offer inventory lists and reminders for upcoming renovations. And if you opt for the latest generation of software, you can benefit from electronic interfaces to banks or dedicated rent accounts – making rental income monitoring and accounting even easier.

Flat-rate service charges

Prefer to keep things simple? Then it’s worth checking whether you can charge service costs as a flat rate. This can reduce your administrative workload significantly. However, a flat-rate model only makes sense if you’ve known the exact level of service charges for several years and they don’t fluctuate much – in other words, if gas and electricity prices are (more or less) stable.

Tips for managing your apartment as a private landlord

With the following tips and tricks, you’ll be well on your way to renting out your property successfully – even if you take care of the management yourself:

Before renting out your apartment

• Research the legal framework: Get familiar with the local regulations and laws relating to property ownership and rentals. If you have open questions, seek advice from a legal consultancy or contact a homeowners’ association.
   
• Set the right rent: Before you can rent out your apartment, you need to define an appropriate rental price. A rent index can give you a general idea of typical rents in your area – but it is not legally binding. To set a fair rent, base your price on local market rates. Tip: Our online calculator can help you estimate a suitable rent.

• Consider potential rent increases: Be aware of the rules around rent increases. One key factor is the reference interest rate, which is calculated quarterly based on the average interest rate of all Swiss mortgages. If the reference interest rate rises by at least 0.25 % after the contract has been signed, you may increase the rent. Tenants, on the other hand, must actively request a rent reduction. As a landlord, you may increase the rent at the next possible termination date in accordance with Article 269d of the Swiss Code of Obligations. Keep in mind that, in theory, the rent cannot be increased within the first 12 months after a new contract is concluded. In practice, it is often 15 months, as the tenant’s 3-month notice period must also be taken into account.
   
• Review your insurance coverage: Check whether all relevant risks related to renting out your condominium are covered. Legal protection insurance, for example, is highly recommended for landlords.
   
• Find reliable tenants: Plan enough time to find suitable candidates. During viewings, ask questions to assess whether prospective tenants are reliable and responsible – and likely to contribute to a stable, harmonious tenancy. You can find more advice in our tips for finding the right tenants.
   
• Create compelling listings: Your listing should include precise and complete information about the apartment. Realistic, high-quality photos increase interest. A fair rental price can also make all the difference, so it’s worth comparing similar properties before setting your price. Be transparent about your requirements for potential applicants (for example, income level or whether pets are allowed). You’ll find more tips for your listing here.
   
• Draw up a clear rental agreement: Your rental contract should clearly state all key points in writing – including the rent, service charges, notice periods, and deposit terms. House rules and maintenance obligations (such as minor repairs) should also be clearly defined. Any additional agreements, such as keeping pets, must be explicitly included in the contract.
   
• Build a network of trusted tradespeople: Sooner or later, maintenance work and repairs will be needed. Make sure you can rely on experienced and dependable tradespeople when the time comes.

During the tenancy

• Create and maintain a contact list: Keep an up-to-date list with the contact details and addresses of all tenants.
   
• Prepare a rent overview: List all tenants in one document, including the agreed rent and service charges. This overview is also important if you decide to sell your property one day.
   
• Communicate house rules clearly: Make sure all parties are familiar with the building’s rules and regulations.
   
• Keep proper accounts: Record all income and expenses so you always have a clear overview of your property’s finances. By the way: you’ll also need a property statement for the tax authorities.
   
• Monitor rental payments: Ensure rent is paid on time and that rental deposits are held in a separate account.
   
• Consider tax deductions: Maintenance costs that preserve the property’s value are tax-deductible. These include repairs, boiler descaling, service subscriptions, and building insurance, among other things.
   
• Prepare the property statement for the tax office: Depending on where you live, the tax authorities may require specific information from landlords. As a private individual, you do not need to hire a fiduciary company for your balance sheet and income statement. In most cases, keeping invoices and preparing a documented income and expense statement is sufficient.

After the tenancy

• Terminate the rental agreement correctly: As a private landlord, you must comply with statutory notice periods and termination dates. The notice of termination must be sent by registered mail, in writing and with a stated reason. For family homes, both spouses must be informed separately. Terminations must not be abusive.
   
• Ensure a smooth handover: At the handover, prepare a handover report documenting the condition of the apartment and the meter readings. This report must be signed by both parties. Conduct the handover together with the tenants and take photos if necessary to avoid misunderstandings later on.

Have you come to the conclusion that managing everything yourself is more complex than expected? In that case, we recommend finding a reliable property manager through associations such as Casafair or the Homeowners’ Association (HEV).