If you would like to purchase real estate: Information and analyses on developments and trends in the Swiss real estate market.
Swiss Real Estate Market 2016
Banished from paradise
For more than ten years now, the Swiss real estate markets have enjoyed near-paradise conditions: continuously rising prices and rents, booming demand, and low vacancies against the backdrop of low interest rates. In recent years, however, there have been growing signs that other, less favorable times lie ahead. Real estate investors are no longer able to source easy returns just like that. Further support from interest rates hardly appears possible. In the future, therefore, investors will increasingly have to rely on their own services in order to generate the hoped-for returns in real estate markets.
In order to do justice to the strong regional anchoring of the real estate markets, we offer informative factsheets at the regional level. You will find details on how to order them on page 77 of the study.
Real Estate Monitor Switzerland Q3 2016
Low interest rates drive vacancies
In a sea of low-yield capital investments, real estate continues to offer interesting returns. For this reason, high amounts of capital are being channeled into property development, which in turn raises the amount of available space – especially in rental apartments. The consequences are increasingly clear: for the third year in a row, the number of vacant homes rose by more than 5000 units in 2016. Rental apartments were more heavily affected in 2016 than in preceding years. The vacancy rate subsequently rose to 1.3% – a figure not seen since 2000. Vacancies in office and retail space also increased, though not to a great extent. There is no question of calling this an easing in either market – the necessary growth stimulus on the demand side is lacking. The owner-occupied housing market, however, remains on a normalization path. Price growth is less steep and vacancies have barely risen.
With low interest rates encouraging high output of rental apartments, the obvious winner is the construction industry. The main construction trade is back on its feet and should report sales that are higher in 2016 than in 2015. There are also signs of a nascent recovery in the finishing industry. Since demand in the end-user markets has topped, though, some medium-term risks for construction sales have emerged.
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