Low key interest rates keep mortgage rates low

The SNB last left its key interest rate at 0 percent on March 19, 2026. This means that short-term financing remains attractive for homeowners and homebuyers. The advantage of Saron mortgages persists, but with long terms, the risk of slightly higher fixed costs increases.

The Swiss mortgage market remains remarkably calm in the summer of 2026. After the Swiss National Bank lowered the key interest rate to 0 percent in June 2025 and left it unchanged on March 19, 2026, financing options closely tied to the money market in particular remain affordable. For homeowners facing a renewal and for buyers, this means that Saron mortgages retain their price advantage, while fixed-rate mortgages are particularly appealing for the planning certainty they offer.

The crux of this development lies not in a new surge in interest rates, but in the lack of movement. Available assessments indicate that no rapid tightening is expected in 2026. This supports short-term maturities and keeps financing costs for residential real estate low. At the same time, the effect on the market remains mixed, as cheap money eases affordability pressures but also stabilizes prices that are already high.

Saron Remains the Leader
As long as the SNB’s key interest rate remains at 0 percent, the Saron—which is linked to the money market—remains the most affordable solution for many households. This is especially true for borrowers with sufficient financial reserves and a willingness to absorb potential future interest rate hikes. Those who opt for Saron today are primarily buying flexibility. This can be an advantage if the yield curve is falling or moving sideways.

However, this strategy is not entirely risk-free. Even moderate interest rate hikes would directly increase ongoing costs. For homeowners on a tight budget, older borrowers, or buyers with a tightly calculated affordability margin, a fixed-rate mortgage therefore remains a relevant option. In the current environment, the premium it commands is primarily the price paid for certainty in budgeting.

Longer terms remain trickier
The picture is less clear-cut when it comes to longer-term fixed rates. While short- and medium-term terms benefit from the stable policy rate environment, longer terms may be more sensitive to international yield movements. In real estate practice, this means that the choice of term is once again becoming more a matter of risk profile than a bet on an imminent interest rate move.

For the housing market, the consequence is clear. Low financing costs do not prevent downward price pressure for the time being; rather, they further bolster buyers’ willingness to pay. This helps property owners and stabilizes transactions, but makes it harder for buyers to enter the market if property prices remain high. The benefit of low interest rates does not end with the mortgage; rather, it has a direct impact on market pricing.