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Renting For Members

What is Switzerland's ‘rent calculator’ and how can it help you?

Helena Bachmann
Helena Bachmann - [email protected]
What is Switzerland's ‘rent calculator’ and how can it help you?
Calculate your rent to ensure you are not being overcharged. Image by mastersenaiper from Pixabay

With higher rents throughout Switzerland on the horizon, this online tool can help tenants determine whether their landlord is overcharging them.

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In Zurich, the local Tenants Association analysed 5,000 rents and found that more than 45 percent of rent hikes in the city are unjustified. 

This means that either they exceeded the legal threshold, or were unwarranted altogether.

That is important information not only because rents (as well as the cost of living in general) are notoriously high in Zurich, but also since rents are set to increase further: the Federal Housing Office (BWO) announced that key interest rates would rise from the previous 1.25 to 1.5 percent from June 1st. 

This means that landlords have the right to increase the rent by just over 3 percent, on the condition, however, that the current rent is based on the old reference rate of 1.25 percent that has been in effect since March 3rd, 2020, the BWO said.

This hike will affect 54 percent of rental contracts in Switzerland that are based on that rate, but the landlord also has the right to raise the rent for other reasons.

For instance, if a property owner makes investments in your rental accommodation, which increases its value, they have the right to raise the rent proportionately.

Another reason for the rise can be inflation, because when consumer prices go up landlords are allowed to pass on part of the costs of inflation by raising net rents. 

Last but not least, if your landlord’s costs, such as for property management, taxes, or insurance, go up, they can pass these added costs on to you by raising your rent. 

READ ALSO: When can my landlord legally increase the rent? 

Whatever the reason for the hike is, you should be prepared to check whether your rent is unfair. 

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What is an unfair rent?

In 2020, the Federal Court, Switzerland’s highest judicial authority, ruled that owners of rental accommodation can get returns of up to 2 percent higher than the reference interest rate.

With the current rate of 1.5 percent, property owners are entitled to a raise not exceeding 3.5 percent.

Unfortunately, some landlords don’t comply with this rule.

Raiffeisen bank found, for instance, that the overall return on apartment buildings in Switzerland — that is, profit from rents — was around 6.5 percent in 2021.

How can you check whether your rent is not higher than it should be?

Switzerland’s tenant rights groups have special online calculators that can indicate whether this is the case.

It asks you to insert relevant information relating to your rental contract, as well as other details, and you will then see if your current rent, as well as any impending hikes, are justified.

The calculator can be found here for Swiss German regions and for French-speaking areas.  

In the mainly Italian-speaking Ticino, the local chapter can inform you how to check your rent. 

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What happens if the calculator shows your rent is too high?

In such a case, you have the right to challenge a so-called 'abusive' rent by reporting it to the Federal Housing Office (BWO) by a registered letter, but you must do so within 30 days of signing the lease. 

You must explain why you signed the contract, knowing the rent was excessive.

If you can prove that you signed it because you didn’t know your rent is significantly higher than that paid by the previous tenant, that might work.

However, relatively few people file such complaints.

The reason, said ASLOCA’s lawyer Linda Rosenkranz, is that "a dispute requires an appearance in front of the authority of conciliation and, if necessary, even in front of the court. This can be time-consuming and expensive".

Another reason lies in the non-confrontational mentality of the Swiss: “They are very polite and fear conflicts,” she added.

This is confirmed by a study by Sotomo research institute, which found that tenants attach great importance to a good relationship with the landlord and don’t want to jeopardise it.

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