Raiffeisen warns of housing shortage
The turnaround in interest rates is shrinking the financial advantages of owner-occupied versus rented apartments. At the same time, the demand for rental apartments exceeds the housing production. Raiffeisen Switzerland warns in a recent study that this could lead to a housing shortage.
With interest rates rising again, the “rule of thumb, now almost set in stone”, according to which owning is financially cheaper than renting, “has started to falter”, writes Raiffeisen Switzerland in a statement on the current issue of its quarterly study “ Real Estate Switzerland ”. However, there are still financing solutions that make home ownership more financially attractive than renting, the statement continues. In addition, the demand for one’s own four walls is also being driven by “various non-financial” aspects.
However, the demand for residential property, which continues to rise, is “meeting on a supply that has now completely dried up,” explains Martin Neff in the press release. “Hardly any new properties are being built and existing owners only sell their houses and apartments in exceptional cases,” says the chief economist at Raiffeisen Switzerland.
The analysts at Raiffeisen Switzerland have also noticed a shortage of supply on the market for rental apartments. Due to high vacancy rates, the construction of new apartments has already been curtailed in the past, writes Raiffeisen Switzerland. In addition, demand has increased due to demographic aging and a “trend towards individualization”. In 2021, the number of newly founded households exceeded the number of newly built apartments for the first time since 2009.
“Housing production will not be able to keep up with demand in the future either,” predicts Neff. “So the housing oversupply that prevailed until recently could soon become a housing shortage.”