Swiss Housing Shortage Crisis 2026: Zero Rates Fuel Demand
January 26, 2026 | By IMMANO Blog Team
Switzerland enters 2026 with a housing shortage that authorities expect to worsen, even though borrowing conditions remain unusually attractive.
For mortgage borrowers, this creates a paradox: cheaper financing can push demand and prices higher, which raises the required mortgage amount and equity.
This article explains the drivers, what it means for SARON and fixed mortgages, and how borrowers can prepare realistically.
Why the shortage is expected to worsen in 2026
Federal housing signals point to a continued supply-demand imbalance. Demand is rising faster than new supply can be delivered in the locations where people actually want to live and work.
- Population growth: roughly 80,000 additional residents are expected in 2026, increasing immediate housing demand.
- Household formation: more single households means demand grows faster than headcount alone.
- Constrained supply: limited land release, zoning rules and lengthy approvals slow new projects.
- Centre pressure: the tightest markets are typically economic hubs where competition is highest.
What zero rates mean for mortgages: SARON vs fixed
When the policy rate is near zero, SARON-linked mortgages often remain the cheapest option, but they carry rate risk if the cycle turns. Fixed mortgages cost more today, but they provide budgeting certainty.
Key point: In a shortage market, the purchase price (and required equity) often matters more than saving a few basis points on interest.
Focus on total affordability, stress testing and structure, not only the headline rate.
- SARON mortgages (variable): typically the lowest current cost, but payments can change if SARON rises.
- Fixed-rate mortgages: higher starting rate, but predictable costs for a defined term.
- Split structures: mixing SARON and fixed portions can balance cost and stability.
Numbers that matter: prices, equity and affordability
In a tight market, modest price increases translate into meaningful changes in required equity and loan size. If prices rise while the buyer’s equity stays flat, the mortgage amount must increase, and affordability can deteriorate quickly.
- Vacancy rates: around 1 percent indicates persistent scarcity and supports pricing power in many regions.
- Equity requirement: higher purchase prices increase the absolute equity needed for 20 percent down payment rules.
- Bank stress test: affordability is checked with a much higher imputed rate than market rates, so price increases hurt twice.
Common mistakes borrowers make in a shortage market
Zero rates can create false comfort. The most costly errors usually come from overestimating what is sustainable long term.
- Over-leveraging: buying at the maximum limit without a buffer for higher costs or life changes.
- No stress test mindset: focusing on today’s rate instead of the bank’s affordability calculation.
- Ignoring ongoing costs: maintenance, renovations and insurance are often underestimated.
- One-size-fits-all structure: choosing 100 percent SARON or 100 percent fixed without matching risk tolerance.
Practical positioning for 2026
If you plan to buy or refinance in 2026, the goal is to be finance-ready and flexible, because good properties attract multiple offers. Preparation can be a competitive advantage.
- Build equity strength: more equity improves pricing and increases acceptance chances.
- Widen the search radius: consider commuter locations where the supply-demand pressure is lower.
- Use a split strategy: combine SARON and fixed to avoid all-in risk.
- Get clarity early: pre-check affordability and required documentation before viewing seriously.
Next step: If you want to structure a mortgage that fits your risk profile and affordability, use our resources and check your numbers early.
Internal link: IMMANO mortgage overview
External reference: Swiss authorities on the 2026 housing shortage