Mortgage rates are rising again in July

In Switzerland, published mortgage reference rates have risen across all standard terms since the start of July 2026. This means that new mortgages are becoming more expensive for homeowners and buyers, even though effective interest rates remain below the spring highs and banks are coming under pressure on their margins.

Since the end of June, capital market and mortgage interest rates have once again risen in tandem. The main drivers are higher yields on Swiss government bonds and rising swap rates – in other words, precisely those refinancing costs on which fixed-rate mortgages are based.

This trend is particularly evident for longer maturities. Published ten-year rates have risen from 1.78 to 1.89 per cent since the start of July, whilst five-year rates have risen from 1.49 to 1.62 per cent. For three-year fixed-rate mortgages, rates rose from 1.36 to 1.50 per cent, and for two-year mortgages from 1.31 to 1.43 per cent. The FuW Mortgage Index, based on completed transactions, stood at 1.57 per cent in the reporting week, above July’s low of 1.45 per cent but still below the annual high of 1.69 per cent recorded at the start of June.

There remains a gap between indicative rates and actual deals
For borrowers, it remains crucial to recognise that published offers only reflect market price levels to a limited extent. During the week under review, published reference rates were on average 0.32 percentage points below the interest rates actually paid. This makes new financing and refinancing solutions in particular more expensive, as homeowners must decide at short notice whether to lock in terms or speculate on falling rates.

Among the most favourable published offers at the end of July, the lowest ten-year rates stood at 1.64 per cent, whilst rates of 1.09, 1.22 and 1.38 per cent were quoted for two-, three- and five-year terms respectively. At the upper end, published rates ranged up to 2.15 per cent, depending on the term. The price spread between providers therefore remains considerable.

A growing market with new players
In parallel with the recent rise in interest rates, the mortgage market continues to grow. According to analyses by MoneyPark, the Swiss mortgage volume exceeded the 1.3 trillion franc mark for the first time in 2025. Compared with the previous year, this represented an increase of 39 billion Swiss francs, or 3.1 per cent. What is striking is the shift in the market share of providers. Pension funds reached around 34 billion Swiss francs in 2025, placing them just ahead of insurance companies at 33 billion Swiss francs. However, banks remained clearly dominant. According to the analysis, cantonal banks accounted for 506 billion francs, whilst Raiffeisen banks accounted for 231 billion francs.

Official data also show that outstanding mortgage debt in Switzerland remains high. In its 2026 Financial Stability Report, the SNB notes that vulnerabilities persist in the residential property market and that mortgage debt remains at a high level. For property owners, developers and residential investors, this means that whilst financing costs remain below the peaks seen in the spring, the scope for securing favourable deals is narrowing once again.