• Switzerland's news in English

Property prices soar in Switzerland: report

Lyssandra Sears · 18 Apr 2012, 15:05

Published: 18 Apr 2012 10:56 GMT+02:00
Updated: 18 Apr 2012 15:05 GMT+02:00

Facebook Twitter Google+ reddit

Property prices in Switzerland are continuing to rise, with higher numbers than ever before owning their own homes, a new report has found.

A report on the state of the Swiss property market conducted by a real estate consultancy firm, Wüest & Partner, has found that residential property prices, particularly in the Greater Zurich and Lake Geneva areas, have risen considerably.

The price of apartments increased by 4.9 percent across Switzerland last year, with an increase of 10.8 percent in the Zurich area, newspaper Tages Anzeiger reported.

Despite the price hikes, a rise in construction of new-build apartments and single family homes combined with the record-low interest rates have enabled more people than ever before to get on the Swiss property ladder.

But analysts are concerned that many home buyers are pushing the boundaries both of what is allowed and of what is recommended.

"Among the requests for mortgages are more and more applications that clearly operate at the limits of financial sustainability and debt levels," Stefan Rüesch, bank expert for comparis.ch told the newspaper.

The report also refers to an increase in the number of “risky business models”, and comments that the rise in prices is attracting people who want to get in on the action, with the result that the prices are rising even more.

Talks have been taking place for some time between the Swiss financial regulator, FINMA, the Federal Department of Finance and the banks, Tages Anzeiger reported.

One measure being proposed to reduce the risk of mortgage default is to require the banks to insist on a higher proportion of upfront capital investment. At the moment, the average amount of capital required for a residential mortgage is about 20 percent. It is unclear how far this percentage would rise.

The banks however are not keen on increasing the capital requirements.

“Every extra franc of capital requirement increases the cost and reduces the profitability of the business," Thomas Sutter, spokesman for the Bankers Association, told the newspaper.

Lyssandra Sears (news@thelocal.ch)

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
Villagers asked to help fund bridge renovations
The bridge links the two villages of Veltheim (pictured) and Holderbank. Photo: Lutz Fischer-Lamprecht

The crowdfunding campaign by the two communes is the first of its kind in Switzerland.

Police discover body buried in Orbe house
File photo: Bas Leenders

Police have opened an investigation after finding a body buried in a house in Orbe, in the canton of Vaud, on Saturday.

Valais shaken by 4.2 magnitude earthquake
The earthquake hit in the canton of Valais near Sierre. Photo: Alain Rouiller

It's the biggest earthquake to hit the country for two years.

Swiss Indoors kicks off without champ Federer
Federer celebrates with ball girls and boys after winning the event in 2015. Photo: Harold Cunningham/Pool/AFP

Stan Wawrinka is top seed as injured Federer sits it out.

IOC hires Russian doping whistleblower as consultant
IOC President Thomas Bach confirmed the news. File photo: Fabrice Coffrini/AFP

The International Olympic Committee (IOC) has hired Vitaly Stepanov as a consultant and is helping his runner wife Yuliya.

‘Scary clown’ craze hits streets of Zurich
Photo: Pedro Pardo/AFP

Police in Zurich have warned so-called ‘scary clowns’ that they could face charges, following a number of incidents in the city.

VIDEO: driver chases runaway car on Swiss motorway
Image: Neuchâtel police

Shocking footage shows the moment a man dodged lorries to chase after his runaway car on a Swiss motorway.

Saas-Fee crowdfunds low-cost season ski pass
Saas-Fee is hoping to attract 99,999 season pass holders. Photo: Denis Emery/Photo-genic.ch

Skiers could get their hands on a whole season pass for just 222 francs ($223) in the Swiss resort of Saas Fee this winter – if enough people want one.

Swiss billionaire fined for dodging import tax
Urs Schwarzenbach owns the luxury Dolder Grand hotel in Zurich. Photo: Wilhem Rosenkranz

Urs Schwarzenbach faces a $4 million fine for failing to properly declare some 200 artworks imported into Switzerland.

Muslim woman wins headscarf court battle
Photo: Jack Guez / AFP

A Swiss court has ruled against a company that fired a longtime employee after she began wearing the Muslim headscarf.

Photo: Richard Juilliard/AFP
Man makes Geneva airport bomb threat ‘for a joke’
Sponsored Article
Last chance to vote absentee in the US elections
Photo: AFP
Solar Impulse team reveals plans for unmanned plane
File photo: Martin Abegglen
Swiss to vote on passport rules for 3rd gen foreigners
Photo: AFP
Swiss wingsuit hotspot Lauterbrunnen won’t impose ban
Photo: Swiss Tourism
Six reasons Switzerland isn’t as boring as you might think
Photo: Swiss Tourism
Report: Switzerland one of world’s best places for girls
Photo: The Local
Thief returns Swiss cow bells worth thousands
File photo: Wikimedia Commons
One in three rapists isn’t locked up: statistics
Photo: activistin.ch
Tampon-tax protest turns Zurich fountains red
Photo: AFP
Geneva police to lift ban on bearded officers
Photo: Marcel Gillieron/AFP
Suicide chef’s restaurant keeps Michelin stars
Photo: Lara de Salis
11 things the Swiss get tired of hearing abroad
Photo:  Ivo Scholz/Swiss-image.ch
Survey: expats in Switzerland have money but few friends
Photo: AFP
Swiss press criticize Bern’s 'capitulation' on immigration
Photo: Jura Trois Lacs tourism
German ex-policeman is Swiss city’s new hermit
Photo: Dmitry A. Mottl
Ticino votes to favour local workers over foreigners
Photo: file
Some deodorants could cause breast cancer: Swiss study
Photo: Royal Savoy
In pictures: Inside the latest Swiss luxury hotel
Photo: AFP
Geneva airport bomb hoaxer faces 90,000-franc bill
Photo: Schaffhausen police
Mother leaves toddler son alone in car to go clubbing
Photo: Fabrice Coffrini/AFP
Swiss populist attacked by knife-wielding pensioner
jobs available