In the past two years, buying a home has been more expensive than renting, yet home prices have not fallen. However, the National Bank has recently lowered interest rates once again. This has led to an increase in demand for condominiums, with more people considering buying their own homes. The interest rate situation has relaxed significantly over the past six months, leading many in Switzerland to believe that interest rates will not rise in the near future.
The lower interest rates, combined with a tight rental housing market, have made home ownership more appealing. While the number of advertised condominiums has increased in the past two years, there is still a relatively large number of used properties on the market. These properties are often priced high, leading to longer selling times and more supply in the market. Despite this, transaction prices for condominiums have increased, with no signs of a trend reversal in the current year.
Since the interest rate turnaround in 2022, home prices have consistently risen, causing the cost of owning a home to almost double at times. However, with the recent interest rate cut by the SNB, the cost of owning a home may once again be comparable to renting. Sellers are likely to hold firm on their asking prices, especially if interest rates continue to decrease. This may lead to an increase in buyers’ willingness to pay and a resurgence in the housing market.