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So far, the crown crisis has left no trace in Switzerland for the prices of single-family houses and condos. However, there was a massive drop in real estate ads.
The number of single-family home and condo listings coming onto the market every day halved in April, as shown by a real estate study released Thursday by Raiffeisen.
Purchase decisions are postponed
According to Raiffeisen, the slowdown in demand can be attributed primarily to two reasons: On the one hand, the capital base of many potential buyers has deteriorated due to massive losses in the stock market.
On the other hand, economic uncertainty has generally increased, so large financial decisions are currently expected. “Sellers and buyers are currently not doing business with each other. The number of changes in hands will continue to decline, “predicts chief economist Martin Neff.
Sellers stick to sale prices
However, Raiffeisen currently does not see any concessions in the sale price. Sellers are said to be obviously sticking to their pre-crisis selling prices.
The study authors assume that house and condo prices won’t change much over the course of the year. Ultimately, the crisis further consolidated the low interest rate environment, which continues to make residential properties financially more attractive than rent.
Immigration stops
Looking to the future, the institute sees that immigration dampens the Swiss property market. This is said to slow down due to the expected economic downturn even after the reopening of the borders.
Immigration is currently close to zero. According to Raiffeisen, each month of inactivity results in the loss of around 4,500 immigrants. For this reason alone, the number of apartments the market can absorb is 2,500 units lower each month than before the crisis. The study authors hope that separatist immigration will make its mark by 2021.
Migrants pay more
Raiffeisen’s study also addresses the question of how immigrants live in Switzerland. An analysis shows that immigrants mainly move to cities first. For 27 percent of immigrants, one of the five largest Swiss cities (Zurich, Geneva, Basel, Lausanne, and Bern) is their first place of residence. In addition to the main centers, the cities of the cantons of Freiburg and Vaud and Lower Valais are particularly attractive. In German-speaking Switzerland, the canton of Aargau and the Zug region stand out as immigration magnets.
On average, immigrants pay more for a rented apartment and only live in smaller apartments than locals. But mainly they optimize their life situation after a few years by moving to the countryside or the agglomeration, but not to the tourist mountain areas. (SDA / dv)
