Real estate demand reached its highest point during the initial months of the year
The affordability of housing in Switzerland is becoming a significant concern, particularly for households with low income and those of the lower middle class. According to the latest update of the Federal Housing Office's Housing Market Monitor, published on Thursday, this trend is evident across the country.
The scarcity of affordable housing varies depending on the region. While some regions, such as Eastern Switzerland (Ostschweiz), are experiencing a worsening situation for low- and middle-income households, with rents rising by 2.9% between July 2024 and June 2025, others, like Tessin, have seen a decrease in rents by 5.6%. However, the Zurich region, despite being the most expensive, has only seen a moderate increase in rents at 2.1%.
The pressure on the housing market, particularly in urban centers, is increasing. This affordability issue does not apply to the urban centers of Geneva, Lausanne, Basel, Lucerne, and Zurich, where owning a home is becoming increasingly unaffordable for many households.
The current housing market situation is due to a strong economy, low interest rates, and insufficient growth in housing construction. The Federal Housing Office predicts no relief in the medium term for the housing market. Since no improvement is expected from the supply side, this development is likely to continue.
In the existing stock, about 80% of rental apartments are priced in a segment that is affordable for households with low or medium purchasing power. However, this does not hold true for the entire housing market. Approximately 40% of the current rental apartment offers are affordable for the 80% of tenant households with low or medium purchasing power.
The market situation has worsened for these households, particularly in Central Switzerland (Zentralschweiz), where the rental housing market for low- and middle-income households has particularly deteriorated. The pressure is also increasing in the mountain regions.
The rental housing market is particularly important, especially for households with low or medium purchasing power, which account for around 80% of all tenant households. The affordability of rental apartments is a significant concern, especially in urban centers.
The development of housing costs relative to income is becoming a concern, and the situation in the entire housing stock is not yet alarming, but there are signs of deterioration, particularly for low-income households. The Federal Housing Office urges action to address this issue and ensure affordable housing for all.
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