Tenants need to be ready for some hefty rent rises. That’s the message from many landlords across the country.
The reason is rising interest rates. The Federal Housing Office sets what’s known as a ‘reference interest rate’ which property owners use to set rents.
Currently that rate is at 1.25% - but it’s widely expected to be lifted to 1.5%. That means rents could rise by nearly three percent.
An analysis by the Zurich Cantonal Bank suggests half of all current tenancies are based on the current rate.
Swiss Life Insurance is one of the biggest landlords in the country. A spokesman says if the reference rate rises – they will set rents accordingly.
But other property-owning insurers, such as Axa, say they will examine each tenancy individually before setting rents.
Other big owners, which includes the Migros and Coop pension funds – as well as UBS, which has inherited a large portfolio from Credit Suisse – are not commenting.
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