Swiss housing market shows recovery signs, but shortage persists

After several years of continuous decline, the Swiss housing market is finally showing the first indications of a recovery. According to a study published by Wüest Partner, building permits are on the rise, the decrease in vacant housing is slowing, and the rental supply appears to be stabilizing.

"We have likely reached the bottom; the first signals of a trend reversal are beginning to appear," stated Corinne Dubois, an economist at the real estate analysis firm. The primary source of optimism stems from construction activity. Over the past twelve months, permits have been issued for approximately 52,000 new housing units, a level not recorded since the end of 2018. This resurgence, however, almost exclusively benefits the rental housing sector, with permits increasing by 11% year-on-year. In contrast, permits for single-family homes and owner-occupied apartments continue to decline.

Despite these encouraging signs, the underlying issue of housing scarcity persists. While the increase in building permits, especially for rental properties, suggests a potential easing of supply constraints, it will take time for this to translate into a significant reduction in the overall shortage. The market's stabilization is a welcome development for many, but the long-term challenge of meeting housing demand, particularly in urban centers, remains.