Growing optimism in the residential property market
Published: Thursday, Nov 7th 2024, 15:30
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Prices for residential property in Switzerland are likely to continue to rise over the next twelve months. Higher residential rents and rising prices for apartment buildings are also expected.
This is the result of a survey of 663 real estate market experts conducted every six months by Fahrländer Partner Raumentwicklung (FPRE), the results of which were published on Thursday. The data was collected between mid and end of October 2024.
The HEV-FPRE price expectation index for condominiums (EEC) calculated by FPRE from this was 54.4 points in fall 2024, while that for single-family homes (SFH) was 62.5 points. In the survey conducted last spring 2024, the corresponding values were 38.6 and 45.6 points respectively.
In concrete terms, this means that 58% of survey participants expect prices for condominiums to rise or rise sharply, 39% predict stable prices and 3% predict lower prices. In the case of single-family homes, 63 percent expect prices to rise or rise sharply, while 35 percent predict stable prices and 2 percent forecast falling prices.
Upward trend for apartment buildings continues
In the area of residential rents, the index has fallen by around nine points to 48.4, but this is still well above the average of the past 10 years (-1.8), according to the report. A majority of 52 percent of participants expect apartment rents to rise over the next 12 months, while 43 percent expect rents to stagnate and five percent expect them to fall.
According to the survey, the assessment of the performance of apartment buildings in Switzerland has brightened further. After -33.7 points in fall 2023, the lowest level since 1996, the corresponding index rose to 22.7 points in spring 2024 and now stands at 50.6 points in the fall.
Meanwhile, the price expectation index for office rents remains negative and stood at -27.4 points in the latest survey, which represents a slight decline compared to the last six months. By contrast, the assessment of transaction prices for office and commercial properties was slightly less pessimistic: the corresponding index rose from -26.1 points to -15.5 points.
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