Quick answer: A rented apartment offers immediate rental income and a calculable return. But carefully check the existing lease, the condition of the apartment, and the financing. In Eastern Switzerland, you can find attractive properties with net returns of 2 to 4%.
Why a rented apartment?
The idea sounds tempting: you buy an apartment that is already rented out. From day one, rent flows in. No vacancy, no tenant search, no stress. And the money sitting in your savings account finally works for you.
In fact, buying a rented apartment is one of the most popular entry points for private investors in Switzerland. But as with any investment, there are pitfalls.
The market situation in 2026
The conditions are favorable. At the SGKB Real Estate Forum in January 2026, Thomas Stucki, Chief Investment Officer of the St. Galler Kantonalbank, confirmed that the SNB key rate remains at 0.0% -- likely until late 2027 or even early 2028. This means: low mortgage rates for investors, for quite some time yet.
At the same time, transaction prices for condominiums in Eastern Switzerland are rising by an expected 2.5% in 2026 according to Wüest Partner. And Donato Scognamiglio from the real estate consultancy IAZI stated at the TKB Real Estate Forum in November 2025: more and more people from Zurich are looking in Eastern Switzerland -- anyone who moves from Winterthur to Frauenfeld saves around CHF 700'000 on the house purchase and only sits a few minutes longer on the train.
This migration pressure also supports demand for rental apartments. On top of that: Swiss residential property is considered a safe haven in uncertain times. Roman Ballmer from IAZI confirmed at the TKB Homeowner Index (April 2025): "Past crises have shown that Swiss residential property gains in popularity during times of uncertainty."
For investors, this means: low vacancy risk, stable rental income, and long-term value appreciation.
What advantages does a rented apartment offer?
Immediate income
This is the most obvious advantage. From the purchase date, you receive rent. With an empty apartment, it takes weeks or months to find a tenant.
Calculable return
You know the rent, the additional costs, and the purchase price. This allows you to calculate the return immediately. No assumptions, no estimates. Read in our investment guide how to correctly calculate the net return.
Lower purchase price
Rented apartments are often offered at a lower price than vacant ones. The reason: owner-occupiers are eliminated as buyers. Demand is smaller, the price is lower. That is your advantage as an investor.
Proven tenancy
A tenant who has been paying reliably for years and takes good care of the apartment is worth their weight in gold. You are taking over a functioning system.
What risks do I need to know about?
The existing lease is binding
When you buy, you take over the existing lease. This means: you cannot simply raise the rent or terminate the tenant. Termination for personal use is possible but subject to strict conditions.
Check before buying:
- How does the current rent compare to market level?
- When was the rent last adjusted?
- Are there special agreements in the lease?
- Is the tenant punctual and reliable?
Subletting or legacy issues
Look closely:
- Has the tenant sublet the apartment?
- Are there open defect reports?
- Was the security deposit properly deposited?
Renovation backlog
Sometimes an apartment is sold precisely because major investments are due. Kitchen, bathroom, or floor coverings at the end of their lifespan mean high costs after purchase.
How do I finance a rented apartment?
The bank treats an investment property differently from a home:
- Equity: At least 25%, often 30%. The bank is stricter than for owner-occupied properties.
- Affordability: Rental income is credited at 80%. Your earned income must cover the rest.
- Interest margin: Investment properties carry a slightly higher mortgage rate than owner-occupied properties.
Calculation example
A rented 2.5-room apartment in Bischofszell. Purchase price CHF 295'000. Monthly rent CHF 1'240.
- Annual rental income: CHF 14'880
- Gross return: 5.0%
- Equity (25%): CHF 73'750
- Mortgage (75%): CHF 221'250 at 1.6% = CHF 3'540 interest per year
- Management and maintenance: approx. CHF 3'000 per year
- Net income: approx. CHF 8'340 per year
- Return on equity: 11.3%
On top of that comes the long-term value appreciation of the property.
What should I look for during a viewing?
Unlike buying a home, this is not about your personal taste. Check:
- General condition of the building -- Staircase, facade, underground parking. This shows how the condominium owners' association manages its finances.
- Renovation fund -- Is there enough money in the fund? Or are special contributions coming soon? More on this in our guide to condominium ownership.
- Utility statement -- How high are the actual additional costs? Do they match the advance payments?
- Minutes of the owners' assembly -- Are there planned renovations? Conflicts among owners?
- Tenant dossier -- Payment history, correspondence, open items.
Do not forget taxes
As a landlord, you declare the rental income as taxable income. In return, you can deduct:
- Mortgage interest
- Management costs
- Maintenance costs (flat-rate or actual)
- Contributions to the renovation fund
In the canton of St. Gallen, you can choose between a flat-rate deduction and actual costs. Read our tax guide for more. When selling, the capital gains tax on real estate also applies.
Expert tip from Nico: Ask the seller why they are selling. When a rented apartment suddenly appears on the market, there is often a reason. Sometimes it is harmless -- inheritance, relocation, need for liquidity. But sometimes there are problems behind it that you should know about.
Conclusion
A rented apartment is a smart entry into property investment. You have immediate income, a calculable risk, and benefit from the leverage effect of the mortgage. But only if you carefully check the lease, the condition, and the numbers. At Rüttimann Vision, we accompany you from initial interest to the purchase contract -- and beyond.