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Swiss property: Geneva rents rise while Zurich prices dip

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Swiss property: Geneva rents rise while Zurich prices dip
Low interest rates have made Swiss apartment blocks an attractive investment option. Photo: The Local
12:34 CEST+02:00
Rents in the notoriously expensive Lake Geneva region inched up by 1 percent in May while Zurich saw a slight decline of 0.9 percent, according to new figures.

The data from the Swiss Real Estate Offer Index shows prices were almost unchanged nationally last month, with an overall rise of just 0.1 percent.

Rents in May were also only very slightly up – 0.2 percent – on a year earlier.

Read also: Here's how much it costs to rent in Switzerland's biggest cities

But there is a clear east–west divide in the country, according to the index.

Across the Swiss plateau region, prices were down 0.3 percent. The same fall was recorded in the Italian-speaking region of Ticino while rents in central Switzerland fell 0.6 percent.

In eastern Switzerland, the decline was 0.1 percent.

In a statement, the director of property portal ImmoScout24, Martin Waeber, said low interest rates had made apartment buildings an attractive investment option in recent years. As a result, the prices of these properties had risen sharply.

Read also: Eight things you need to know before renting in Switzerland

Concerned Swiss authorities have now tightened up financing conditions for these properties in a bid to rein in spiralling prices, but the new rules are unlikely to have a short-term effect on rents, the ImmoScout24 director added.

This is because rental prices are based more on supply and demand issues.

“Rents are higher in urban centres, where there is a shortage of room, than they are in regional areas where there is a trend towards more available apartments,” Waeber noted.

But he predicted that new financing rules for property investors could act as a dampener on rents in the medium term.

Geneva has highest rents in Switzerland

A recent study showed that Geneva rents are the highest in Switzerland. 

The study by the comparison website Comparis revealed the average price for a 4.5-room, or family-sized apartment,  in Geneva is 3,820 Swiss francs (€3,356) against an average 3,073 francs in Zurich. In the eastern Swiss city of St Gallen, that figure is just 2,004 francs a month.

For 3.5-room apartments, the Geneva average is 2,680 francs and in Zurich it is 2,489 francs.

Read also: Why you may be eligible for a rent reduction in Switzerland

 

 
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