Rising apartment rents in Switzerland: Financial experts warn of further increases

Rising apartment rents in Switzerland: Financial experts warn of further increases

According to a report by www.blick.ch, apartment rents in Switzerland continue to rise. In the 4th quarter of 2023, rents rose noticeably for both new contracts and existing contracts. In comparison, rents for office space remained stable across Switzerland compared to the previous quarter. Rents for new apartments in Switzerland rose by 2.9 percent in the fourth quarter of 2023 compared to the previous quarter, while the increase for old apartments over the same period was 2.2 percent. Compared to the same quarter last year, market rents for new apartments rose by 6.0 percent and for old apartments by 3.9 percent. There was an increase in market rents in all regions. The price increases for new buildings were particularly significant in the Mittelland (+6.7%), Jura (+6.5%) and Zurich (+6.3%) regions.

According to experts, little will change in this trend, as too few apartments have been built in Switzerland since 2020 due to increasing immigration. As a result, demand for living space remains high. Construction activity is not expected to pick up in 2024 either, which will continue to lead to fewer apartments being built and thus further rising market rents. The contract rents for office space were almost unchanged compared to the previous quarter, but increased by 4.5 percent compared to the same quarter of the previous year. However, there were large regional differences, with the clearest increases in the Basel and Mittelland regions and declines in Lake Geneva and eastern Switzerland.

These developments are clear signs of the ongoing shortage of housing and increasing demand in Switzerland, which in turn is leading to a sharp increase in rents. As an expert in the real estate market, it is important that all stakeholders, be it the government, developers or investors, take measures to promote the creation of housing and ensure balanced rental development.