Rising Home Prices
Switzerland’s real estate market, including the housing market, has long been considered stable and reliable. However, the COVID-19 pandemic has disrupted this considerably. The Swiss National Bank brought down its key interest rate to -0.75% to counter the pandemic’s economic impact, which has helped the Swiss real estate market maintain its stable status, but the skyrocketing home prices negate all that. Our goal is to continually enhance your educational journey. For this reason, we recommend checking out this external source containing extra and pertinent details on the topic. immobilien zug https://nobilis-Estate.Com, explore more!
The pandemic has created a drastic demand for houses with spaces that can accommodate a home office setup. People who are searching for homes in the countryside and mountainous regions in Switzerland are now willing to buy at high prices. According to data, home prices are expected to increase by as much as 5% in 2022. Rents, on the other hand, have also been hammered by the pandemic. The virus has caused numerous employment terminations, which have led to payment problems in numerous areas of rental apartments in different regions.
Inequality and Rent Hikes
The consequences of these trends are that they will most likely lead to deeper inequality in the housing market. Due to rising housing costs, low-income families will increasingly struggle to afford a home to live in, and this will lead to the emergence of slums and other housing-related issues. Despite Switzerland’s strong economy, labor conditions, and high salaries, there is a sizable segment of the population that cannot afford the high level of rent and may opt for cheaper alternatives, such as sharing flats or moving to less relished areas.
The situation leads to rent hikes, which are visible in the form of affordable accommodations with a significant number of individuals in each apartment. It has led several cantons to push for bans on subletting apartments to smaller properties.
Changing Consumer Preferences
The pandemic has sparked some changes in housing in Switzerland, as more Swiss consumers opt for more spacious locations. Larger living areas with balconies, garden areas and larger kitchens are suddenly in high demand. Today’s homebuyers are more aware of their child’s educational possibilities and the need for outdoor recreation areas.
Furthermore, the pandemic’s work context has motivated a more significant number of Swiss employees to work remotely, leading to an unexpected popular demand trigger for housing at the mountainside areas. The canton of Graubünden has benefited the most from this sudden trend. A situation of this nature leads us to expect that the current phenomenon of home-buying is here to stay, given the increased need for working from home.
The Effect on the Rental Market
The pandemic has had a greater impact on small landlords who have seen rent payments decline or even stopped coming altogether. The cost of utilities has also continued to rise making the management of smaller properties a much tougher task. It has led to tenants abandoning their houses, leading to higher vacancy rates in many parts of Switzerland. Most Swiss universities have closed their doors and moved to virtual learning in the wake of the pandemic, leading to a significant decline in rental revenues in areas with substantial student populations.
Covid-19 has had a significant impact on the Swiss housing market. The pandemic’s effect on the economy and the decline in the employment rate has led to the rise of inequalities in the housing market, with the possibility of increasing rent and higher housing costs limiting possibilities for low-income earners. Looking for a more comprehensive understanding of the topic? Check out this carefully selected external resource. Immobilien Zürich https://nobilis-estate.com, dive deeper into the subject matter!
Changing consumer preferences and the work context brought about by Covid-19 pandemic have led to an unprecedented rise in demand for housing in the countryside and mountainous areas. While the high demand for housing may have a significant effect on home-buying trends, landlords managing apartment complexes, small landlords, and a significant number of tenants have been adversely affected. Therefore, there needs to be a need for the various stakeholders to come together to ensure a balanced and accessible housing environment for everyone, regardless of their social status.
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