Am I allowed to simply rent out my condominium?

The legal framework: What the community is allowed to say

The regulations are the law.

The first thing you absolutely must do is consult the regulations of the condominium owners' association (STWEG). If you want to rent out your apartment , this document is your bible.

Generally speaking, you are allowed to rent out your condominium without asking your neighbors for permission. It is your property.

However, the regulations may contain restrictions.

• Notification requirement: The regulations often state that you must inform the management if you want to rent out your apartment . This ensures that names are correctly recorded on mailboxes and doorbells .
• Intended use: If the apartment is intended exclusively for residential purposes according to the regulations, then you may not use it for a quiet business (e.g., a medical practice or a noisy office) . Anyone wishing to rent out their condominium must ensure that the tenant uses the apartment in a manner consistent with residential use.

The special case of Airbnb and short-term rentals

This is where it gets tricky. Many owners want to rent out their apartments , but only to tourists for a few days at a time.

This often leads to conflicts (noise, constant coming and going, safety concerns).

The legal situation is evolving. If the constant turnover of residents unreasonably disturbs the other owners, the community can decide to prohibit this type of use. Therefore, if you plan to rent out your apartment – specifically as a vacation rental – you absolutely must check whether the regulations permit this or whether a resolution passed by the owners' association restricts it. Long-term rentals, on the other hand, are almost always allowed.

The Bank: The Silent Partner

An often forgotten aspect when you want to rent out a condominium is financing.

You probably took out your mortgage for "owner-occupied residential property".

• Change of use: If you move out and want to rent out the condominium , the property becomes an investment property.
• Risk assessment: For banks, investment properties are riskier. Furthermore, higher affordability and equity requirements often apply (often 25% equity is required instead of 20%, and pension fund funds are not permitted).

It is therefore mandatory to inform the bank if you intend to rent out your condominium . Failure to do so constitutes a breach of the loan agreement. In the worst-case scenario, the bank can terminate the mortgage or adjust the terms (interest rate). Anyone planning to rent out their condominium must therefore also reassess their financing.

Taxes: What changes for you?

The decision to rent out a condominium will throw your tax return into disarray.

• Imputed rental value no longer applies: As long as you live in the property yourself, you pay taxes on the imputed rental value. This tax no longer applies when you start renting out your condominium (provided the apartment is fully rented).
• Rental income: Instead, you must declare the actual rental income as income for tax purposes. Since the rent is often higher than the low imputed rental value, your taxable income increases.
• Deductions: If you rent out your condominium , you can still deduct maintenance costs and mortgage interest. Additionally, you can often claim management fees (e.g., for advertisements or property management).

It is worthwhile to carry out a tax calculation before taking the step of renting out the condominium .

Your responsibilities as a new landlord

Once all the hurdles are cleared and you are allowed to rent out your condominium , your role changes. You are no longer just the owner, but a landlord with obligations under the Swiss Code of Obligations (OR).

Administration and additional costs

If you want to rent out your condominium , you must be able to create a correct utility bill.

• As the owner, you pay contributions to the community (renewal fund, management fees). You are not allowed to pass all of these costs on to the tenant.
• Only "consumption-based" costs (heating, water, building maintenance) can be passed on to the tenant. Costs for building repairs or contributions to the reserve fund are the responsibility of the owner. Anyone wishing to rent out their condominium must clearly record this separation in their accounting.

Maintenance in the apartment

In a condominium association (STWEG), you're responsible for everything within your own four walls. If a tenant's refrigerator breaks down, you have to replace it. You can't call the community's property management company – they're only responsible for the hallway and roof. Anyone who wants to rent out their condominium must therefore budget for repairs within their own unit.

The correct rental agreement

If you want to rent out your condominium , use professional templates (e.g., from the HEV). Make sure that the condominium owners' association's house rules are included in the rental agreement.

• Important: Your tenant must abide by the community rules (laundry schedule, quiet hours). If they don't, you, as the owner, will face problems with the neighbors and the property management. Anyone who wants to successfully rent out a condominium must inform the tenant of these obligations.

Risks of "renting out a condominium"

The project of renting out a condominium also involves risks that you need to be aware of.

• Vacancy: If you can't find a tenant, the mortgage and utility costs (which you have to pay to the community) continue.
• Rent dodgers: A thorough credit check is essential if you want to rent out your condominium .
• Liability: If your tenant damages common property (e.g., scratches the elevator), you as the owner are often primarily liable to the owners' association. You then have to recover the money from the tenant.

Conclusion

The question "Can I simply rent out my condominium?" can be answered with a "Yes, but." Property law generally allows you to rent out your condominium . A prohibition by the neighbors is only possible in extreme cases (e.g., disruptive short-term rentals).

The bigger hurdles are not legal, but financial and administrative. You have to inform the bank, recalculate the taxes, and transfer the community's house rules to the tenant. Anyone who wants to professionally rent out their condominium first checks the regulations, then talks to the bank, and finally carefully selects the tenant to ensure peace within the community.

If you are unsure whether the rent you have calculated covers the costs or how to identify legal pitfalls in the regulations, Loft offers neutral data and analyses to secure your plan to rent out your condominium .

Glossary

• Condominium owners' association (STWEG): The association of all owners of a building. Its rules are decisive if one wants to rent out a condominium .
• Regulations: The "constitution" of the condominium owners' association. This may contain restrictions (e.g., a ban on commercial activity) that are relevant if you want to rent out your condominium .
• Imputed rental value: A notional income that must be taxed if you live in the property yourself. If you start renting out your condominium , this is replaced by the actual rental income.
• Renewal fund: A savings account for owners to use for renovations. You cannot pass on contributions to this fund to the tenant if you want to rent out your condominium .
• Change of use: The change from "owner-occupied" to "rented out". This must be reported to the bank, as the risk structure of the mortgage changes.