National economy Real estate remains expensive and sought-after
Harbingers of an economic slowdown in Switzerland are not yet dampening demand for real estate: despite job cuts in construction and industry and falling immigration, concrete gold remains in demand. And this is also increasingly the case in peripheral regions.
18.11.2025, 10:42
SDA
The Swiss real estate market remains stable, according to a study published on Tuesday by real estate consultants IAZI. This is because low mortgage interest rates and Switzerland's reputation as a safe investment location are supporting demand.
However, IAZI warns that an economic slowdown could well put the brakes on demand for housing in the medium term. This would also affect the real estate market.
Affordable apartments remain in short supply
According to IAZI, the housing shortage in Switzerland is worsening. The vacancy rate nationwide stands at a low 1.0 percent.
Rents on offer have also risen significantly, particularly in the cities. This is leading to migration to conurbations and rural regions.
Renovations are also driving up rents. According to the report, this could lead to rents becoming unaffordable for existing tenants.
In central locations, rent increases after renovation average 50 percent. However, rents will also rise significantly in urban agglomerations (+23 percent) and rural regions (+15 percent).
Buying more attractive than renting?
Prices for residential property have risen by 26% since 2020, the report continues. Last year alone by 2.6 percent.
Nevertheless, buying a home is still worthwhile, as the monthly costs have fallen compared to renting. Ten-year mortgages are available for 1.8 percent and a money market mortgage (SARON) for around 1.1 percent.
However, according to IAZI, a purchase is subject to high regulatory requirements in terms of equity and income. In addition, due to the high prices, owner-occupied homes are hardly affordable for many potential buyers without a loan or advance withdrawal of inheritance.
Stable market environment expected
Despite global uncertainties, trade conflicts and other economic challenges, the market environment for real estate is likely to remain robust. This is because the shortage of building land, interest rate trends and demographic shifts in demand remain unchanged.
However, the experts also warn of risks from stagnating wages, political uncertainties and demographic changes. In addition, natural hazards and climate risks will become increasingly important for the attractiveness of a property location in the long term.
