Switzerland: rental housing market looks at dark 2017

The Swiss rental market is expected to contract again in 2017. Wüest & Partner, real estate consulting firm, provides an average contraction of 0.7% in Ticino, the decline will be less marked.

The reference rate, since its unification in Switzerland in 2008, fell from 3.5% to 1.75%, allowing a decline in rents of up to 17% to the benefit of long-time tenants, as the report "Immo-Monitoring" refers.

The trend is motivated by the offer in terms of new buildings. Currently, 157'900 new apartments are in the lease. Moreover, since the population growth slowing, the housing demand has been further lowered.

All the country will record the deep, but in Ticino, in the Canton of Zurich and the city of Zurich the decline will be less noticeable, respectively 0.1, 0.3 and 0.2%. In Geneva, the decrease is expected to reach 1.4% and 1.3% in Central Switzerland.

In terms of purchases, the trend is rather bullish. For individual homes, Wüest & Partner expects an increase of 0.6% in costs, after a 1.2% progression between the middle of 2015 and that of 2016.

Commercial real estate invecce will undergo a pressure on rents and prices will be falling for office and retail space.