Real estate Prices for residential rents are rising in almost all regions

Rents for apartments continued to rise in almost all regions of Switzerland in the second quarter of 2024. Rents for office space, on the other hand, show a mixed picture.

Market rents for new contracts for new-build apartments rose by 1.3% in the second quarter compared to the first quarter of the year. The increase was even higher at 2.0 percent for apartments in older buildings, as the real estate consultancy Fahrländer Partner Raumentwicklung (FPRE) reported on Friday.

Rents rose in almost all regions of the country. The strongest increase for older buildings was in the Basel region (+5.0%), the Alpine region (+3.5%), Jura and Eastern Switzerland (+2.4% each). Southern Switzerland was the only region to record a slight fall in market rents (-1.2%).

The increase is even more pronounced over the year as a whole. Compared to the second quarter of 2023, market rents rose by 6.7% for new-build apartments and by 5.3% for older apartments.

According to the analysis, the trend towards higher market rents is likely to continue. This is because immigration will remain high in 2024 and too few apartments will continue to be built to meet demand.

Office market with major regional differences

In contrast, contractual rents for new office space decreased by 0.7% compared to the previous quarter. Compared to the previous year, however, there was an increase of 4.2%.

However, the development of contractual rents varied considerably from region to region. While the Lake Geneva and Central Plateau regions recorded quarter-on-quarter increases of 3.6% and 1.6% respectively, office rents in Southern Switzerland and Zurich fell by 5.0% and 3.0% respectively.