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Mortgage interest rates are likely to rise further in 2023.
Milena KälinEditor Wirtschaft
The bad news for homeowners never ends. Mortgages cost more than twice what they did a year ago. The average reference interest rate is currently 2.54 percent for five-year and 2.76 percent for ten-year fixed-rate mortgages. That writes the comparison service “moneyland.ch”. In October, the high was even 3.5 percent.
“On average, a ten-year fixed-rate mortgage costs around twice as much as it did in early 2022,” says Benjamin Manz (42), Managing Director of Moneyland. Five-year fixed-rate mortgages have risen even more. They are currently 2.5 times higher than at the beginning of last year.
A third wants to change models
No wonder a third of homeowners are dissatisfied and are therefore considering changing their mortgage model. The rapid rise in mortgage rates is leading many homeowners to go over the books on their home financing in the fourth quarter. This is according to a study by the comparison service Comparis.
13.5 percent of those surveyed want to switch to a fixed-rate mortgage or at least increase the proportion of the total amount that the fixed-rate mortgage accounts for. Another 17.5 percent are thinking about switching to a Saron mortgage or increasing the Saron share.
Why are mortgages increasing so much?
The reason for the sharp rise in interest rates is inflation. Or rather: the measures that the Swiss National Bank (SNB) is taking to counteract inflation.
The SNB has already raised the key interest rate several times in 2022. According to experts, further interest rate hikes are to follow this year. A key interest rate of 1.5 percent is expected after the second meeting in June 2023 at the latest. A Credit Suisse analyst even assumes that the key interest rate will be 1.75 in June, but will not rise any further after that. The key interest rate is currently 1.0 percent.
Inflation has stabilized somewhat in the meantime. At 2.8 percent, inflation in December was still well above the maximum 2 percent target set by the SNB. Credit Suisse analysts assume that inflation will fall below 2 percent again in the second quarter.
Mortgage interest rates could continue to rise
It is uncertain whether further interest rate hikes will also make mortgages more expensive. Because the increase to 1.5 percent by the middle of the year should already be priced into the mortgage interest rates for fixed-rate mortgages.
The big question, however, is whether this will be enough to get inflation under control again. “In 2023, I expect mortgage interest rates to remain high, which is more likely to increase,” said Felix Oeschger, an analyst at Moneyland.
Credit Suisse also assumes that fixed-rate mortgages will become more expensive in 2023. By the end of the year, the average reference interest rate for five-year and ten-year fixed-rate mortgages should rise to around 3.0 percent.
One thing is certain: not only mortgage interest rates are rising. Personal loans are also becoming more expensive.
