What is the difference between the situation in Switzerland and that in Sweden or Germany?
Comparing the real estate market between countries is a difficult task as there are many factors involved. Just because prices are falling in Sweden due to rising interest rates, that doesn’t have to happen in Switzerland. The regulatory environment or the supply structure also play a role. In the European countries where prices are declining, you can see that the rules on lending were far too lax in some cases. And at the same time you have higher inflation and higher interest rates. And if a larger proportion of property owners have variable financing, there is a problem. Refinancing becomes difficult and forces one or the other to sell the property. And with the expansion of supply, there is a price collapse. During the low interest rate environment, there were often critical voices who criticized the strict regulations regarding affordability in Switzerland, in particular the imputed interest rate. These strict guidelines are intended for times like this and are now paying off accordingly.
