Housing cost Switzerland

Every three months the rate of interest used to benchmark Swiss rents is reviewed. If it goes down some renters have the right to request a decrease in rent. This time the reference rate fell from 1.50% to 1.25%.

Potential relief for some Swiss renters — Â© Ocskay Mark | Dreamstime.com

The last time it dropped was 2 June 2017 when it fell to 1.5%.

The rate is based on the average Swiss mortgage rate over three months. This rate is then rounded to the nearest 0.25%. On 31 December 2019 that rate was 1.37%, which is closer to 1.25% (-0.12) than 1.5% (+0.13).

In general if your rental contract links your rent to mortgage interest rates then you can demand a decrease in rent when this reference rate declines. The Swiss Association of Tenants, Romande branch, provides useful information on when and how to go about making a demand. Their website (in French) can be found atÂ www.asloca.ch. Similar information can be found here in German.

Whether you qualify for a reduction will depend on your rental contract. Tenancy associations advise that landlords are unlikely to automatically offer a reduction. To get one you will generally need to contact your landlord and request a reduction.

Reference rates since September 2008 can be viewed here.

More on this:
Government press release (in French) â€“ Take a 5 minute French test now

For more stories like this on Switzerland follow us on Facebook and Twitter.

On average, renting a 4.5 room apartment of 100 to 110 m2 costs CHF 3,820 a month in Geneva. The same apartment in the Swiss city of St. Gallen costs CHF 2,004, 52% of the price, according to a report on rents in Switzerlandâ€™s ten main cities by the price comparison website Comparis.

Â© Rosshelen | Dreamstime.com

For an apartment of this size, Geneva (3,820) is the most expensive, followed by Zurich (3,073), Lausanne (2,850), Basel (2,660), Bern (2,600), Luzern (2,430), Winterthur (2,400), Lugano (2.110), Biel (2,050) and St. Gallen (2,004).

High rents are driven by low supply and high demand. Vacancy rates are particularly low in Geneva and Zurich and relatively high in Biel (2.4%) and St. Gallen (2.3%). The Swiss average is 1.62%.

A high number of well paid jobs in Zurich and Geneva increases the price people are prepared to pay in those cities, increasing demand.

The housing supply is being increased, but in less desirable regions such as Huttwil where nearly 15% of the apartments are currently empty. An expert at Comparis says this has been driven by low interest rates and a strategy of developers building where they can rather than where people choose to live.

More on this:
Comparis article (in German)

For more stories like this on Switzerland follow us onÂ FacebookÂ andÂ Twitter.

Stay up to date