Simple collective ownership and Ownership By Floor (PPE)

In Switzerland, in multi-family apartment buildings, there are two forms of co-ownership: simple co-ownership where several people (generally private investors or banks) own the entire building and Ownership By Floor, PPE, where everyone obviously fully own their home and is co-owner of the communal areas.

The term Ownership By Floor (PPE), in particular the word « floor », can confuse foreigners who buy an apartment in Switzerland and perhaps some Swiss when they want to buy an apartment in an apartment building. Actually, this blunt name of PPE is probably reminiscent of a time when, before large apartment buildings, single-family homes were divided by floor, each owning a floor. Today, when you buy an apartment in an apartment building, you obviously don’t own the whole floor.

Summary of property types

– The so-called individual property

This is the easiest type of property to understand. You are the exclusive owner of a property, whether it is a house with its garden and outbuildings, land or others. You benefit from the exclusive rights attached to it and assume all the duties. In simple terms, you are at home and do whatever you want as long as you don’t disturb the neighborhood or violate the rules such as town planning of the municipality where you live.

– The so-called collective property

As the name suggests, this is any property that is shared between several owners who all have rights to the entire building and not just to a part of it. The Swiss Civil Code makes a distinction between collective ownership, simple co-ownership and ownership by floor.

In collective property the owners form a community and all are equal owners of the entire building. This is, for example, the case after a death when the children inherit property together. For this type of property, each decision regarding the building must be validated by all the owners.

In simple co-ownership, several people are co-owners of an entire building, each of the co-owners having shares in the building. These parts do not correspond to specific parts (such as an apartment or a garage) but to a certain percentage of the walls (1/5th or 1/10th for example) that the owner can have at his disposal. Usually this type of property is owned and managed by private investors or banks.

In ownership by floor, each owner is the exclusive owner of a lot – his or her apartment, for example, which he or she can arrange as he or she sees fit – and co-owner of the communal areas for which he or she pays charges. The rules of ownership by floor can relate to a small complex of buildings, a house where each floor has a different owner or a large group of several floors with several apartments.

Owner of his apartment and co-owner  of the communal areas: this is the PPE

This is the form of ownership known to everyone who owns an apartment in an apartment building. Everyone has exclusive ownership of their home (plus basement and/or garage if applicable). This « lot » is commonly referred to as a « floor unit ». The purchaser uses his “floor unit” as he sees fit and is co-owner of the communal parts of the building (entrance, stairs, elevators, hallways, garden, park, swimming pool, tennis court as well as the walls, the roof, the facade, etc.) The costs generated by the communal areas are distributed according to thousandths, the number of which depends on the surface area of ​​the “floor unit”. These thousandths determine for an owner the number of votes he will have in decisions taken during general meetings of the co-owners as well as the share to be paid for all the expenses of the co-ownership. The more area an owner has in a building, several apartments for example, or a very large apartment, the higher his share.

Any PPE has rules and regulations. It is managed by an administrator. It can be a co-owner, the law allows it, but for large co-ownerships, the administrator is a real estate agency which takes care of the financial, technical and administrative management.

If you want to buy an apartment in a residence, it will most likely be a PPE. Beyond the price of the apartment (+ basement, garage, parking spot?) and notary fees, remember to find out precisely about the co-ownership fees which may, depending on the standing and reputation of your residence, strain your budget. Your real estate agent will be able to give you all the information you need to make an informed decision.

DISCOVER OUR SOLUTIONS TO BUY THE PROPERTY OF YOUR DREAMS