Legally a building right is an easement under Art. 675 and Art. 779 ff. ZGB. It breaks the principle that a building always belongs to the landowner ("superficies solo cedit"): thanks to the building right, a house can belong to someone other than the land it stands on. If the building right is structured as an independent and permanent right and entered in the land register as its own property, the holder can sell, bequeath and mortgage it – almost like normal ownership.
The basis is the building-right contract, which is publicly notarised and entered in the land register. It governs the key points: duration (usually between 30 and a maximum of 100 years), the amount and adjustment of the ground rent, what happens to the building at expiry (reversion) and what compensation is then due. The ground rent is the payment for using the land; it is often calculated as a percentage of the land value and adjusted periodically – for example to inflation or the mortgage rate.
Among the costs the ground rent is the largest item. As a rough guide it is often around 3 to 5 % of the land value per year (no guarantee) – sometimes lower with non-profit providers. For the holder this means a lower initial investment, because the land does not have to be bought, but a permanent annual burden. At the end of the term the building reverts to the landowner (Heimfall), usually against compensation set in the contract.
Building rights are common when municipalities, churches, foundations or pension funds do not want to sell land but make it usable long-term – for example for housing cooperatives or commerce. For buyers of a building-right property the remaining term is decisive: the closer the reversion, the harder the financing and the lower the value. Before buying, the contract, remaining term, rent adjustment and reversion clause should be checked carefully – ideally with legal support.