Swiss property market: prices have stabilised


Swiss Property Prices Now Stabilised

Switzerland’s residential property market has settled down into a period of stability. At present, price rises are relatively moderate in many parts of the country. This is the conclusion reached by the “Residential Market Report Switzerland 2016”, just published by Engel & Völkers. It details market developments in approximately 50 locations. “Many buyers are assessing properties on the market with extra care, but the level of demand remains constant nonetheless,” said Thomas Frigo, Managing Director of Engel & Völkers Wohnen Schweiz AG.

High level of interest in economic centres
Prospective buyers continue to hold Switzerland’s business centres in high regard. A large number of multinational companies are located in Geneva, for example. The popularity of the city and region is leading to high prices in several market segments. The highest priced residential neighbourhoods in Geneva include Cité, Rive Gauche and Cologny. Buyers can expect price highs of up to 50 million Swiss francs (approx. 45.6 million euros) for mansion properties. Top prices per square metre for freehold apartments in Geneva range from 15,000 to 20,000 Swiss francs (approx. 13,700 to 18,200 euros).

Zurich is the main financial centre in Switzerland and offers a high quality of life. Prices here for detached properties in very good locations start at 4 million Swiss francs (approx. 3.6 million euros). Prices per square metre for freehold apartments lie between 13,000 and 17,000 Swiss francs (approx. 11,900 to 15,500 euros). Up-and-coming districts in the city include Zurich West and Oerlikon. Many people with capital assets or large salaries are drawn to the attractive neighbourhoods along the eastern shore of Lake Zurich otherwise known as the Gold Coast. Zollikon, Kusnacht, Erlenbach and Herrliberg are all desirable addresses here. The entry price for homes in prime locations is 2.5 million Swiss francs (approx. 2.3 million euros). Freehold apartments on the Gold Coast sell for between 12,000 and 20,000 Swiss francs per square metre (approx. 10,900 to 18,200 euros).

Holidaymakers drawn by the mountains and lakes
Switzerland’s internationally renowned ski resorts rank amongst the most desirable destinations in the country. St. Moritz will be holding the FIS Alpine Ski World Championships in 2017. Exceptional properties here can sell for as much as 70 million Swiss francs (approx. 63.8 million euros). Freehold apartments at exclusive addresses change hands for between 20,000 and 35,000 Swiss francs (approx. 18,200 to 31,900 euros) per square metre. The Suvretta Hillside remains the most exclusive location in St. Moritz, along with the Via Tinus and Via Brattas at the centre of the village. Prospective buyers in St. Moritz are looking for second homes for private use and as a sound capital investment.

The ski resort of Gstaad in the Bernese Highlands is witnessing a consistent level of demand in the luxury segment. There is an especially high interest in traditional chalets with superior, modern fittings. Particularly attractive properties can be found, for example, near the historic Gstaad Palace hotel, offering unique views of the village and mountains. Buyers are paying up to 50 million Swiss francs (approx. 45.6 million euros) for outstanding homes in very good locations. Prices per square metre for freehold apartments at prime addresses currently range between 35,800 and 50,000 Swiss francs (approx. 32,600 to 45,600 euros).

The stunning scenery and mild climate make Ascona and Lugano in the canton of Ticino desirable places to live and spend holidays. Properties directly on the shores of Lake Maggiore or Lake Lugano are in high demand, as are homes with lake views. Prices for mansions at premium addresses in Ascona can reach as much as 22 million Swiss francs (approx. 20.1 million euros). Top freehold apartments sell here for between 15,000 and 25,000 Swiss francs (approx. 13,700 to 22,800 euros) per square metre. Several new building projects are currently under development in Ascona, aimed at meeting the high demand from interested buyers based nationally and internationally.

Outlook: prices set to remain stable
Several factors have contributed to the overall stabilising of prices on the Swiss property market. They include the more tentative approach of banks to mortgage lending and the calming of the market in the wake of the revaluation of the Swiss franc. Engel & Völkers forecasts that the market in Switzerland will remain stable throughout this year. “We are not anticipating any significant rise in prices in 2016,” said Thomas Frigo. A trend towards “buy to let” properties as capital investments is emerging in the freehold apartment segment. These homes are primarily intended for rental, rather than for private residency. The high level of building activity in Switzerland continues, meaning that a considerable number of new residential developments will also be coming onto the market in 2016.

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