Swiss house prices are falling noticeably
House prices got a little cheaper in November.
tsf. Real estate prices continue to come under pressure. Prices for single-family homes continued to fall in November. There are signs of relaxation for tenants – at least for the time being.
Inflation and interest rate hikes have been cooling the overheated real estate market for several months. The trend even intensified in November. This is shown by the Real Estate Offer Index, which is collected by the Swiss Marketplace Group in cooperation with the real estate consulting company IAZI. The index tracks the prices for the houses and apartments offered on the market.
In the case of offers for single-family homes, the index for November shows the first noticeable decline in a long time. Providers have lowered their price expectations by -0.9 percent. However, this is still at a high level: with an average price per square meter of around CHF 7,370, prices are still generally high. However, November brought practically no change in prices for condominiums. They increased in price by 0.2 percent.
A decisive factor in the market is the Swiss National Bank. A further rate hike in mid-December cannot be ruled out. At 3 percent, inflation is still above the target value, even if inflation in this country is low compared to other countries. If interest rates rise again, this will increase the cost of mortgages. “This could cloud the mood of prospective buyers,” explains Martin Waeber, Managing Director Real Estate, SMG Swiss Marketplace Group, in the media release.
In terms of rental prices, there is a slight relaxation. For example, advertised rents fell slightly in November at -0.6 percent on the national average. Depending on the region, however, rental price trends deviate significantly from this average. Asking rents fell more sharply in Central Switzerland (-2.1 percent) and in the greater Zurich region (-1.3 percent). Little or no change can be seen in the Central Plateau (-0.3 percent), in the Lake Geneva region (-0.2 percent) and in Eastern Switzerland (0 percent), while in North-West Switzerland (+0.4 percent) and in Ticino increase in asking rents (+1.0 percent).