Real estate prices remain high
The Swiss real estate market remains attractive. This is shown by an analysis by Zürcher Kantonalbank. The experts expect prices to rise as a result of immigration and limited living space. Many young adults prefer to stay in the so-called Hotel Mama because they cannot find an apartment.
Real estate prices will remain on an upward trend in 2026. Forecasts by Zürcher Kantonalbank(ZKB) predict a price increase of 4.5 percent. The abolition of the imputed rental value will have no impact on this, nor will the baby boomers change the situation, according to a press release on the latest Immobilien aktuell study.
On the housing market as a whole, the pressure on owners, tenants and tradespeople is growing as a result of the housing shortage and immigration. Switzerland is dependent on immigration, but the influx is “exacerbating the demand for housing in already tight markets”. One in four newcomers move to the five largest cities – one in ten to Zurich.
The ZKB experts expect the situation to remain tight as a result of a drop in demand for rental apartments. Vacancy rates are at a record low and are having a particular impact on the relocation behavior of young adults. In 2023, 15 percent fewer people between the ages of 21 and 25 will have moved than in 2020. “Many will stay in Hotel Mama because there is no suitable living space available,” they say.
Demographic change will not have a price-reducing effect. “Baby boomers are expected to increase the supply of single-family homes by around 14% and condominiums by 10% by 2035,” it says. “Demographic change will change the market, but will not trigger a price slump,” Ursina Kubli, Head of Real Estate Research at ZKB, is quoted as saying. Prices for second homes rose by 40 percent in 2019 and 2024, but will remain at a high level after a slight decline in 2025.
ZKB’s forecasts are based on studies of the abolition of the imputed rental value, the supply restriction for rental apartments, a possible wave of sales by the baby boomer generation, market influences due to immigration and the changed vacation apartment market.