(Financial) services Swiss real estate market recovered significantly in 2024
The Swiss real estate market recovered in 2024 after the dampener caused by the temporary rise in interest rates in the previous year. Residential space has regained value. At the same time, rents rose more sharply than at any time in the last 20 years.
21.03.2025, 09:54
SDA
Residential space in particular benefited from high demand in 2024, according to a study published on Friday by real estate consultancy IAZI. According to the IAZI Swiss Property Benchmark figures, they increased in price by an average of 2.5 percent across Switzerland. In contrast, office and commercial space once again saw a depreciation of 0.1 percent, albeit minimal.
Thanks to the increase in value, the performance of investment properties was 5.3%, 2.4 percentage points higher than in 2023. The increase in office and commercial properties was somewhat less pronounced, with yields rising from 1.4% to 2.9%.
Residential rents rise sharply
Rents also rose significantly last year. Prices for residential rents climbed by a median of 4.5 percent. This is by far the strongest increase in the past 20 years, writes IAZI. In 2023, the increase was just 2.4 percent.
The reason for this was the two increases in the reference interest rate in 2024. In addition, the inflation adjustment and general cost increases under tenancy law had an impact on existing tenancies. However, asking prices for new lettings have also increased significantly.
At the same time, rents for office and commercial space rose by 2.9% (median). In the previous year, the increase was slightly lower at 2.7 percent.
Vacancy rate stable at a low level
Meanwhile, vacancy rates remain at a low level. As in the previous year, the average vacancy rate for residential space in 2024 was 2.2%.
Most vacant apartments were in Basel (7.6%) and Lausanne (7.0%), while there were very few in the city of Zurich (1.5%). Lausanne (2.1%) and Bern (2.1%) were in line with the Swiss average, while the figures for Geneva (2.3%) and Basel (3.3%) were slightly higher.
According to the IAZI, the downward trend in office and commercial space that has been ongoing for several years continued. The average vacancy rate was 5.8% after 5.9% in the previous year.
Cautiously optimistic outlook
IAZI is cautiously optimistic for the current year. Whether the favorable environment for direct real estate investments will continue in the current year 2025 is uncertain.
"In times of global uncertainty, Swiss real estate remains a sought-after investment," writes IAZI. However, it remains to be seen whether they will be able to compensate for a possible return to higher interest rates and a possible economic slowdown.
