Are you dreaming of owning your own house in Switzerland but wondering if it’s really worth buying or if renting would be a better option? In this article, we will explore the advantages and disadvantages of buying and renting real estate in Switzerland. Whether you’re a tenant looking for the stability of ownership or a potential buyer still hesitating, this article will help you make an informed decision. Let’s take a look at current trends in the Swiss market and the costs associated with buying and renting.
Current trends in the Swiss market
How are tenants and homeowners distributed in Switzerland? According to recent statistics, Switzerland had 57.7% tenants in 2021, 2.7% more than in 2016. On the other hand, Switzerland had 36.3% homeowners in 2021, 5% less than in 2016.
These figures show that Switzerland is a country of tenants, and this trend has strengthened in recent years due to the increase in real estate prices and bank requirements to qualify for a mortgage.
Distribution of tenants and homeowners in Switzerland in 2016 and 2021
Is it more financially advantageous to be a tenant or a homeowner in Switzerland?
Until recently, being a homeowner meant lower monthly costs than being a tenant. This idea is not entirely the case today, especially in regions with high population density, such as the cantons of Geneva, Zurich, and Lucerne.
In the city of Lucerne, for example, tenants pay on average up to 25% less than homeowners.
Although investing in real estate is a significant financial source in the long term, it can reduce monthly purchasing power in the short and medium term.
Advantages and disadvantages of renting or owning in Switzerland
BUY – Advantages and inconveniences
| ADVANTAGES | INCONVENIENCES |
|---|---|
| Profitable long-term investment, especially in regions where real estate prices are rising. Freedom to make changes and customize your home according to your tastes and needs. | Significant initial investment (20% of the total price excluding additional costs). Responsible for repairs and maintenance of your property. Long-term mortgage resulting in monthly payments over many years. |
RENT – Advantages and inconveniences
| AVANTAGES | INCONVENIENTS |
|---|---|
| Great flexibility, allowing you to move more easily according to your personal or professional needs. Not responsible for major repairs or maintenance costs of the property. Lower initial costs than buying, such as security deposits and moving fees. | Less stability as you are subject to the landlord’s decisions regarding leasing, rent increases, or repairs. Unlike buying, the rent you pay does not allow you to build real estate equity. Compliance with rules that may sometimes go against your desires (no pets, restrictions on the use of a barbecue, etc.) |
Do I have a buyer or tenant profile?
With our simple test, you can find out what suits you best. Simply score each question from 1 to 5, with 1 being ‘not at all suitable’ and 5 being ‘perfectly suitable’.
Professional situation
1. The sector I work in is stable.
2. There are sufficient job offers I could potentially apply for in the region where I potentially want to invest.
3. I am a person who stays in a job for at least a few years.
Family situation
4. The property I’m considering is suitable for the size of my current and future family.
5. My family and I envision ourselves in the region where we potentially want to invest in the long term.
6. My family and I cultivate stable habits and always make rational and thoughtful choices.
Financial risk tolerance
7. I am willing to reduce my available money to invest in real estate.
8. I am not afraid to do renovations in my future property.
9. I am comfortable with the idea of being able to estimate only a range of amounts to be paid in a real estate investment.
Calculation
Add your points
- > 36 points and above: you clearly have the profile of a homeowner.
- 28 – 35 points: Property is still a bit risky, but you already have good resources. Reassess before you proceed.
- 20 – 27 points: Wait a bit before you start; buying real estate is a somewhat recent project.
- < 19 points: You clearly have the profile of a tenant.
To rent or to buy: an individual reflection
The decision to buy or rent a house in Switzerland depends on many personal and financial factors. It’s important to weigh the pros and cons of each option and consider your individual situation.
Whether you choose to buy or rent, make sure to make an informed decision that best fits your needs and goals.
Head of Marketing at MOVU
Charline has a sharp expertise in data analysis, understanding market dynamics, and identifying trends in the moving industry in Switzerland. Thanks to her experience, she provides valuable insights, helping readers better understand the developments and challenges in this market.
