Home ownership and rents will become more expensive in June
Published: Thursday, Jul 4th 2024, 08:10
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Prices for single-family homes in Switzerland rose in June, as did those for condominiums. Rental properties were also advertised at higher prices than a month earlier.
After a period of leveling off at a high level, prices for single-family homes published in advertisements rose again noticeably in June. Specifically, the price increase was 1.2 percent, according to the "Swiss Real Estate Offer Index" published on Thursday by Immoscout24 and real estate consultancy IAZI. At the same time, prices for condominiums rose by 1.0%.
Compared to the price level a year ago, single-family homes became 0.9 percent more expensive and condominiums 2.2 percent more expensive.
According to the press release, these figures suggest that home sellers have become more confident again about the potential proceeds from the sale of their properties. This is also supported by the improved framework conditions following the interest rate cut by the SNB.
"The Swiss National Bank's further reduction in key interest rates in June and the prospect of a further reduction in September will result in lower financing costs for mortgages," Martin Waeber, Managing Director Real Estate at SMG Swiss Marketplace Group, is quoted as saying in the press release. "This increases both the attractiveness of owning your own four walls and their affordability."
However, demand is also being supported by the continuing high level of immigration coupled with low inflation and unemployment.
Rents also continue to rise
Advertised prices for rental apartments also rose by a total of 0.4 percent across Switzerland in June. However, there were regional differences here. The strongest increases compared to the end of May were in Ticino (+3.3%) and Central Switzerland (+1.8%). By contrast, prices fell slightly in the greater Zurich region (-0.6%) and in north-western Switzerland (-0.2%).
This means that, on average, asking rents have not increased since the beginning of the year. Compared to a year ago, however, rents have climbed by 4.0%.
According to IAZI and Immoscout24, this dynamic upward trend in advertised rents is likely to continue for the rest of the year due to strong demand, particularly in city centers.
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