Tuesday, February 7, 2023

“Now the rules of the game are changing in the real estate market”

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House prices start plummeting

“Now the rules of the game are changing in the real estate market”

The price structure on the real estate market is changing. The prices have partially slipped. And with that, the rules of the game that have shaped this market over the last few years are also changing.

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Asking prices for single-family homes fell in November.

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Christian KolbeEditor Economics

The trees on the real estate market no longer grow to the sky. Sellers have become more cautious, forgoing the maximum return on the single-family home they put on the market. This is shown by the Swiss Real Estate Offer Index. This fell for the second time in a row in November and reveals a noticeable slide in prices for single-family homes.

Is this the trend reversal on the real estate market, will the slide in prices accelerate in the coming months? “No, a trend reversal cannot be derived from this,” says Robert Weinert (44), co-head of research at the real estate consultancy Wüest Partner. “The prices are not in free fall, many price indicators point to a stable market.” Claudio Saputelli (53), Head of Real Estate Analysis at UBS, speaks of a “robust market” and adds: “At the moment the numbers are still surprisingly good, it takes several months of negative growth rates before you can speak of a downward trend.”

Rising housing costs for everyone

Donato Scognamiglio (52), head of the real estate consulting firm Iazi, also does not want to dramatize, but points out: “Now the rules of the game are changing in the real estate market.” Because the environment has changed, mortgage interest and ancillary costs are rising, inflation is eating away at the budget. “People are slowly realizing that it will be more expensive if I buy.” Housing costs are also rising for homeowners – not just renters.

Added to this is the uncertainty about the future development of the economy. Too many question marks and too much uncertainty to really think about buying a house in peace. Potential buyers are becoming more cautious, calculating more precisely whether renting might not be better than buying.

signs of cooling

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