"The tight housing market has made it more difficult to find residential property in Lucerne."

The city of Lucerne is popular – and not just with tourists. Available residential property is especially in demand here. Sina Zemp, Head of the Mortgage Center for Central Switzerland, talks about developments on the real estate market in Lucerne and reveals her best tips for prospective buyers.

Ms. Zemp, you live and work in Lucerne. What do you like best about this region as a place to live?

Sina Zemp:* I have always been at home in the Lucerne region. I grew up in the country, but I have been living in the city on the western shore of the lake for 14 years now. The region of Lucerne has a great deal to offer, whether culturally or in terms of scenery. The lake and the proximity to the mountains are the hallmarks of the region. What's more, Lucerne is located right in the heart of Switzerland.

Over the long term, it is roughly 17% cheaper to own a residential property in Lucerne.

Sina Zemp, Head of the Credit Suisse Mortgage Center for Central Switzerland

Buying is more affordable than renting. This is made clear by the 2019 Swiss Real Estate Market study. Does that also apply to the Lucerne real estate market?

Yes, we are observing that trend in Lucerne as well. Owning residential property here is roughly 17% cheaper over the long term than renting an apartment or house would be. That's astonishing because, although real estate prices have steadily risen over the past few years, that difference is still striking.

Is residential property in the city of Lucerne even affordable?

The tight housing market has certainly made it more difficult to find residential property in recent days. Those who want to buy a property often move to the suburbs. Nevertheless, it is possible to find suitable property even in the city, but then it will be a condominium. Those who wish to buy a single family dwelling have virtually no choice but to look to the surrounding areas. 

On the one hand, there are fewer residential properties available. On the other, the number of vacancies in Switzerland, especially rental apartments, has risen sharply in the past ten years. Is this also the case in Lucerne?

In Lucerne, the vacancy rate in June 2019 was 1.53%, significantly below the overall average of 1.66% for Switzerland. It is interesting to note that the figure for apartments with four or more rooms is significantly lower. This shows that larger rental apartments with multiple rooms are in short supply even in Lucerne. People today want to live in larger spaces. For instance, children used to share a room, but today, that is no longer the norm.

Anyone in Lucerne wanting to buy a house or apartment can find help at…

At any Credit Suisse branch. They have a real estate corner with current listings of real estate and land for development in the region. The information is available to anyone interested with no obligation. In addition, we distribute the offers within the region through our client advisors. That often enables us to bring two parties, the buyer and the seller, together. 

Speaking of land being developed: Where are most buildings currently being built in Lucerne?

The growth in construction is exciting to follow. We see major differences between the suburbs and downtown areas. More construction tends to take place in the suburbs and less in the centers of major cities. The result is a homemade housing shortage in city centers. For that reason, more and more areas are being developed in the suburbs of Lucerne – for example, Seetalplatz in Emmen and the entire Matthof quarter in the direction of Kriens and Horw. 

Dense construction is also an issue for Lucerne. What requirements are the canton and the municipalities placing on rezoning?

The latest revision of the Swiss Spatial Planning Act requires building zones to be used optimally in the future. The idea is for urban developments to grow inward instead of outward. In other words, this will prevent the zoning of excessively large sections of land while inner reserves are to be used better and developed more densely. 

"In downtown areas, prices could continue to climb."

Sina Zemp, Head of the Credit Suisse Mortgage Center for Central Switzerland

Lucerne is one of the pioneers of the digital permit procedure for planning applications. How can residents request building permits electronically?

On its website, the Canton of Lucerne provides an online form. Prospective builders can upload all the necessary documents there. However, the process is not yet fully digitalized. The law still requires planning applications to be submitted in physical form. Nevertheless, this does give people the opportunity to initiate inquiries and receive instructions in advance.

Finally, let's get an assessment of prices. What sort of trend can we expect to see in Lucerne's real estate market?

In the city, the supply of residential properties could continue getting tighter. Therefore, it is likely that prices in the city's center will rise higher. In the suburbs, we are headed toward an oversupply of rental apartments. That could lead to declining prices for rental apartments in the longer term. In rural areas, our tendency is to expect that prices will neither rise nor fall, but remain the same. However, that ultimately depends on the location's level of development and infrastructure.

Are you looking to buy real estate in the Lucerne region?

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