12:13 PM Property in Switzerland | ||||
#switzerland real estate # Regional StatisticsSwiss housing market slowing sharplySwitzerland’s property market is now slowing sharply, amidst economic slowdown and the government’s efforts to cool the market.
Rental apartments showed the same trend. The average price of rental apartments rose by 1.93% (1.87% inflation-adjusted) y-o-y in 2014, according to the SNB. Old rental apartments gained 1.83% (1.77% inflation-adjusted) y-o-y in 2014, while new rental apartment prices rose by 5.22% (5.16% inflation-adjusted). The property market's slowdown can be attributed to efforts by the federal government and the Swiss National Bank to cool the market by stricter lending criteria and lowering housing debt (which currently makes up about 90% of all household debt). “This development is long overdue,” said Dominik Matter of Fahrlдnder Partner. “Prices have reached such high levels in certain geographic areas and market segments that households simply could no longer afford them.”
Some regions are now experiencing falling house prices. In 2014, the Berne area saw an annual house price drop of 2.21% (-2.27% inflation-adjusted); Lake Geneva area prices fell 0.89%, and Zurich area prices fell 0.84%. The Swiss property market is expected to continue slowing this year, according local property experts. That's because Switzerland’s economy is expected to contract by about 0.5% this year, mainly due to falling oil prices and declining exports caused by the strengthening of the Swiss franc against major currencies. It expanded by just 1.25% in 2014, after growing by 1.9% in 2013, 1% in 2012, 1.8% in 2011 and 3% in 2010, according to the International Monetary Fund (IMF). Despite the recent slowdown, the property market's "bubble risk" intensified in Q3 2014, rising by 4% from the previous quarter, to reach 1.29— considered in the ‘risk zone’ by UBS. who publish the bubble index.
| ||||
|
Total comments: 0 | |