Real Estate Rental prices continue to rise in December
The imbalance between supply and demand on the Swiss housing market is causing rents to continue to rise. There is no improvement in sight.
21.01.2025, 10:54
SDA
Specifically, asking rents rose by 3.2 percent across Switzerland in December 2024 compared to the same month last year, according to figures from the Homegate rental price index published on Tuesday. Compared to the previous month, this represents an increase of 0.9%.
Over the whole of 2024, demand for rental properties in Switzerland has remained high, writes Homegate. This is due to population growth and the low number of newly built apartments. Accordingly, the vacancy rate fell for the fourth year in a row. The imbalance between supply and demand continues to drive up asking rents.
However, there are also countertrends, according to the press release. In 2024, factors that had been weighing on tenants had normalized. Among other things, the sharp rise in energy prices and the associated ancillary costs as a result of the war in Ukraine no longer applied. In addition, the reference interest rate remained constant last year. As a result, asking rents rose less sharply in 2024 than in the previous year, writes Homegate.
Regional differences
There are also major regional differences. According to the rental price index, rents climbed the most in Central Switzerland. For example, an increase of 7.7 percent was recorded for Lucerne and an increase of 11.4 percent for the canton of Nidwalden. According to the press release, the high increase is likely due to the dynamic economic development as well as a spillover in demand from the neighboring canton of Zurich.
By contrast, rents rose less sharply in the cantons of Ticino (+1.9%), Jura (+0.7%) and Neuchâtel (+0.6%). Graubünden was the only canton to record a year-on-year fall in rents.
In the canton of Zurich, the increase in asking rents was again significant at 4.8%, but still below the previous year's growth. Homegate believes the reason for this is the lower net immigration in 2024, a trend that can also be observed in other Swiss centers such as Lausanne, Bern and Geneva.
Nevertheless, a stabilization of asking rents is not in sight, writes Homegate. The Swiss population is likely to continue to grow. At the same time, the supply is hardly expanding due to the low level of new construction activity.
The Homegate rental index for asking rents is compiled by the real estate marketplace Homegate in collaboration with Zürcher Kantonalbank (ZKB). It measures the monthly, quality-adjusted change in rental prices for new and re-let apartments based on current market offers.
