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RENTING

How much will your rent in Switzerland rise by if you move house?

Housing costs are notoriously high in Switzerland, and moving to another flat won’t necessarily help you save money — in fact, you could end up paying more.

How much will your rent in Switzerland rise by if you move house?
Check the old rent before signing on for the new one. Photo: Pixabay

There is an unwritten rule in Switzerland that rent should not exceed one-third of income.

However, according to a new study conducted by the real estate company Wüest Partner, after a move to a new apartment, even a smaller one, a large portion of tenants are paying much more to cover the cost of new digs.

The study found that, on average, 28 percent of households spend more than a third of their income on rent after moving.

Why is that?

If you are looking for a new apartment and think that a smaller one will be cheaper, that is often not the case.

“A four-room apartment does not necessarily cost twice as much as a two-room apartment,” said Robert Weinert, head of immo-monitoring ar Wüest Partner Wüest Partner.

One reason is the persisting — and, in some cases, worsening — housing shortage.

Another is that when an old tenant moves out and a new one arrives, landlords have the right to increase the rent by up to 10 percent.

As a result, many older people, who find themselves alone after the children move out, live in large apartments they have had for many years.

For this very reason, the living space per person increases sharply from the age of 55 — these tenants live alone or with a spouse in their old apartments, which were previously occupied by three, four or five people, Wüest Partner said.

READ ALSO: Can you really save money on rent if you move into a smaller flat in Switzerland? 

Where do new tenants spend more than one-third of their income on rent?

Wüest Partner’s analysis found that this is especially the case in canton Geneva, where 56 percent of tenants see their rents exceed one-third of their earnings.

Zug is next with 40 percent, followed by Zurich and Vaud (36 percent), and Ticino (31 percent).

When looking at individual cities rather than cantons, this trend is most evident in the five largest cities — Basel, Bern, Geneva, Lausanne and Zurich —where a four-room apartment in an older building costs on average around 1,900 francs per month with existing rental agreements.

If an apartment of this type is put on the market today, however, the rent will rise to 2,300 francs on average.

Landlords must show you the previous rent upon request, so you can compare the numbers before you sign the contract.

What if your new rent is more than 10 percent higher?

The most logical move is not to rent the apartment in the first place.

If you are already a tenant, you have the right to challenge an excessive rent, by reporting it to the Federal Housing Office (BWO) by a registered letter, but you must do so within 30 days of signing the lease. 

You have to explain why you signed the contract, knowing the rent was excessive. 

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RENTING

Why are more and more residents moving out of Swiss cities?

Switzerland’s largest urban centres have recorded an exodus of sorts, with the increasing number of people relocating away from cities.

Why are more and more residents moving out of Swiss cities?

While in the past city living appealed to many new residents, mostly due to employment opportunities and infrastructure, today largest urban centres are recording an exodus of sorts, with the increasing number of people relocating away from cities.

The reason, according to a UBS report, is that high rents in cities like Zurich and Geneva, are – literally— driving people away to the suburbs, where housing is less costly.

The advantage of a small and compact country like Switzerland is that the countryside — that is, small towns and villages that surround urban centres — lies in close proximity to the city, so no long commute is required.

“The outskirts of cities are becoming more attractive, as tenants can save considerable amounts on rent by relocating,” the report states.

As a result, “the country’s five major cities have recorded departures of around 15,000 people per year between 2020 and 2022, the highest in the last 40 years,” according to UBS.

“In Zurich, Bern and Geneva, annual net departures were three to four times more numerous than in the previous 10 years.”

Just how much cheaper is it to rent in the suburbs?

“For many families, savings are substantial,” UBS found. “In 2023, rents offered within a 10-minute travel radius were on average 16 percent lower outside cities.”

In the Zurich area, for instance, where housing costs are notoriously high, rents, after a 10-minute drive away from the city centre, are a fifth lower. After a 20 minute-commute, they are a third lower, and after 60 minutes, half as low.

UBS cited the example of Schlieren and Dübendorf, two towns located less than a 15-minute drive from the centre.

READ ALSO: Five commuter villages near Zurich where it’s easier to find an apartment

A similar trend is observed in another expensive city, Geneva.

However, rents in Lancy, a 10-minute drive from the centre, are 16 percent lower, and even more so (21 percent) in another nearby community, Vernier.

READ ALSO: The best commuter towns when working in Geneva

The price drop is slighter in Lausanne and Basel, where rents in nearby communities fall by 5 percent and 11percent, respectively.

‘A matter of time’

This ‘town-to-country’ trend is expected to continue, at least in the medium-term.

But does higher demand for housing on the outskirts mean that high rents will shift to the countryside as well?

“This depends on the ability of those areas to absorb the growing demand,” said Ursina Kubli, head of property research at Zurich Cantonal Bank. However, “the pressure on the housing market will increase in certain regions.” 

Another real estate expert,  Fredy Hasenmaile, agreed that “Switzerland is heading towards a housing shortage of unprecedented proportions. Housing shortage has not yet reached the countryside, but it is only a matter of time.” 

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