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What's the outlook for the Swiss property and rental market in 2023?

Helena Bachmann
Helena Bachmann - [email protected]
What's the outlook for the Swiss property and rental market in 2023?
Lucky will be the ones who get keys to a new Swiss home next year. Photo: RODNAE Productions on Pexels

As anyone who has been trying to buy a house or rent an apartment in Switzerland knows, it is not an easy undertaking, especially in certain high-demand regions. We spoke to an expert to find out what the future holds.

Looking to move? Find your next rental apartment here.


Whether you are planning to buy a property or rent one, this may not be the best time to do so.

“Rising interest rates, high immigration, and low construction activity – many factors have an impact on the domestic real estate market", said a recent Credit Suisse study.

And things don’t look any better for 2023. When it comes to buying property, interest rates are forecast to go up. 

"Currently, the market is assuming an interest rate hike of 0.5 percentage points by the Swiss National Bank in December, and one of 0.25 percentage points in March 2023," Felix Oeschger, analyst at Moneyland price comparison platform, told The Local.

He added that these rates “are likely to have already been priced into the real estate market and mortgages”.


The exact evolution, is however, difficult to forecast, Oeschger said.

“If the interest rate steps anticipated by the market are not sufficient to curb and ultimately reduce inflation, I expect mortgage rates to rise further in 2023. Such a scenario could be fuelled, for example, by an electricity shortage, further increasing energy prices."

On the other hand, mortgage rates could fall if there is a significant recession in Switzerland — in which case the central bank “would probably be forced to ease monetary policy".

At this point, however, that is an unlikely scenario.

While a recession could impact neighbouring countries this winter, Switzerland is expected to dodge it.

The reason is that Switzerland is “better equipped” to withstand the economic crisis.

“We believe that we can avoid a severe recession,” said Eric Scheidegger, chief economist and deputy director of the State Secretariat for Economic Affairs (SECO).

A more likely evolution is that a further tightening of monetary policy will be necessary to get inflation under control.

“Consequently, I expect mortgage rates to rise further in 2023. However, I think it is unlikely that interest rates will rise as sharply as they did at the beginning of 2022."

READ MORE: EXPLAINED: What the steep rise in Swiss interest rates could mean for you


What about rental properties?

Tenants are expected to experience hardships in the coming months, with the vacancy rates predicted to drop below 1 percent, according to a study released on Thursday by Raiffeisen bank.

The shortage of available accommodation will drive the rents upwards, the study found.

“Rising interest rates and construction costs are undermining incentives to build [new] homes,” said Martin Neff, the bank’s chief economist.

To make matters worse, Switzerland’s population continues to grow and is looking for ever-larger living spaces.

Since the beginning of the year, the vacancy rate has fallen from 1.54 to 1.31 percent at the national level, with some regional rental markets already experiencing the crisis.

According to Neff, cantons of Geneva, Zurich and Zug have vacancy rates below 1 percent. This record drop mainly concerns rentals, though the vacancy rate is “very low” on the property market as well.

Oeschger agrees that there are “very large” regional differences in vacancy rates.

“In the major centres of Zurich, Geneva, Basel, Bern and Lausanne, it is likely to remain very difficult to find a suitable apartment, as these regions have very low vacancy rates," Oeschger said.

"In the other regions, however, the availability of rental apartments is significantly better in some cases."

READ MORE: Where in Switzerland are you most likely to find flats for rent?



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