The period of slowing rental growth in Switzerland will be replaced by a period of faster rate increases. This forecast was given by Raiffeisen Bank in a recent study, pointing to the depletion of constraints and rising construction costs amid the conflict in Iran.
The bank's experts note that the recent price stabilization in the rental housing market is coming to an end. The mitigating effect of lowering the key interest rate is about to cease to work, while rising energy prices due to the war in Iran are driving up the cost of construction materials and work.
According to experts, there remains an imbalance between supply and demand in the market.
One of the key reasons for the housing shortage is the record low volume of construction. Despite the apparent shortage of apartments, construction activity in Switzerland is at a historically low level. The study attributes this to the growing regulatory complexity: stricter requirements for energy efficiency, climate protection and accessibility, as well as stricter technical standards, which lengthens approval procedures and increases costs and risks for developers.
Source: Swissinfo
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