Long-time homeowners can be happy: the prices for houses and apartments have been rising for 20 years.
Rising interest rates and the economic environment continue to have an impact on the Swiss real estate market. The prices for condominiums and single-family homes also rose in the fourth quarter, but only very moderately. And the number of transactions has decreased.
While houses were 0.6 percent more expensive compared to the third quarter of 2022, the prices for apartments increased by 0.3 percent in the final quarter of 2022, as the real estate valuation platform RealAdvisor announced on Monday. Nevertheless, long-term homeowners can be happy. Because last year was the twentieth consecutive year of rising real estate prices, with prices increasing by 5 percent cumulatively for the year as a whole.
The past year was a special one, the statement continued. The rise in prices for houses and apartments has “finally” calmed down a bit. The demand for home ownership has weakened due to the economic uncertainties and rising interest rates for mortgages.
Selling takes longer
The number of transactions has also fallen by more than 20 percent, while the number of properties available at the end of 2022 has increased by almost 40 percent compared to a year ago. Those who want to sell now need more patience until a buyer is found.
Not only the mortgage interest rates have risen, but also the construction costs, which makes real estate investments even more expensive. Overall, the market for residential real estate has changed significantly in recent months, which makes the situation even more difficult for potential buyers.
Looking ahead, RealAdvisor believes interest rates are likely to remain elevated. The uncertain situation in the global economy will also continue to have a negative impact on buyer demand. Nevertheless, prices for private residential real estate should remain stable across Switzerland, but could slip in some less dynamic regions.
RealAdvisor offers an online portal for the valuation of real estate and is active in Switzerland, France and Spain. Founded in 2017, the company currently employs more than sixty people, around 30 of them in development. (SDA/koh)