Housing market: situation eases
According to a study by the Federal Office for Housing, the situation on the Swiss housing market continued to ease in 2015. However, the market remains very tight in the hotspots of the Lake Geneva region, Zurich and central Switzerland.
The decrease in net migration from EU/EFTA countries was expected to ease in 2015, writes the Federal Office for Housing (FHO). In fact, the growth in supply in 2015 kept pace with the increase in households in both the rental and home ownership sectors. This led to a decrease in the shortage compared to 2014 in both the rental apartment and home ownership markets. Nevertheless, the situation remains tense, particularly in Central Switzerland, the greater Zurich region, the region around Yverdon-les-Bains and, most recently, the Bern/Thun region.
In the rental housing market, on which housing production is increasingly focused, the easing is still limited to the expensive offers, the BWO notes. The difference between the market situations is therefore extremely pronounced depending on the price segment. In eastern Switzerland and Ticino, on the other hand, the rental apartment markets are clearly relaxed in all segments.
With the exception of Ticino and French-speaking Switzerland, all regional markets in the residential property sector are still far from equilibrium. However, price growth has come to a halt due to the high level reached to date and limited purchasing power in combination with increased financing requirements. According to the BWO, prices have even fallen significantly in the Région lémanique. With sufficient construction activity and moderate household growth, the path to equilibrium should not be too long, the Federal Office predicts.
Further decline expected for 2016
There are also signs of a weaker increase in demand from foreign households on the housing market in 2016; in the first four months of the year, net migration from the EU/EFTA region fell by a third. According to the BWO, the situation is likely to ease further in 2016 if construction activity remains the same.
According to the Federal Office, foreign households currently account for around half of total household growth, which means they have a significant influence on the market. Developments on the housing market therefore depend heavily on the extent of immigration and further construction activity. (ah)
