Affordability is a key factor when it comes to granting mortgages, and no country regulates it as strictly as Switzerland. Because of the high affordability demands, many Swiss people (often wrongly) assume that they cannot realise their dream of owning their own four walls due to their insufficient affordability.
What many potential home-owners, in particular, do not know is that the frequently cited maximum affordability value of 33.3 per cent and other criteria are not set in stone and, depending on the provider, there is a lot of scope here.
What does “affordability” actually mean?
Affordability refers to how the ongoing costs of a property and its financing compare with the buyer’s gross household income. These costs include, for example, mortgage interest, any amortisation payments and ancillary costs.
When it comes to the maximum affordability amount, an inaccurate rule of thumb is often cited which states that ongoing costs should not make up more than a third of the buyer’s household income.
Get a quick and easy indication of your affordability with our affordability calculator.