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, increasing required mortgage volumes and equity.
This article explains the key drivers, what zero rates mean for SARON and fixed mortgages, and how buyers can prepare realistically.
Why the housing shortage is expected to worsen in 2026
Federal housing indicators point to a persistent supply-demand imbalance. Demand continues to rise faster than new housing can be delivered in locations where people actually want to live and work.
- Population growth: roughly 80,000 additional residents are expected in 2026, immediately increasing housing demand.
- Household formation: more single households cause demand to grow faster than population figures alone.
- Constrained supply: limited land availability, zoning rules and lengthy approval processes slow new developments.
- Pressure in centres: economic hubs face the tightest markets and the strongest competition.
What zero interest rates mean for mortgages: SARON vs fixed
With policy rates near zero, SARON-linked mortgages often remain the cheapest option. However, they carry interest-rate risk if the cycle turns. Fixed-rate mortgages cost more today but offer long-term budget certainty.
Key insight: In a shortage market, the purchase price and required equity often matter more than saving a few basis points on interest.
Focus on overall affordability, stress testing and mortgage structure rather than headline rates alone.
- SARON mortgages: lowest current cost, but payments may rise if SARON increases.
- Fixed-rate mortgages: higher starting rate with predictable long-term costs.
- Split structures: combining SARON and fixed tranches can balance risk and stability.
Numbers that matter: prices, equity and affordability
In a tight market, even modest price increases lead to significant changes in required equity and loan size. If prices rise while equity remains unchanged, mortgage volumes grow and affordability deteriorates quickly.
- Vacancy rates: around 1 percent signal persistent scarcity and pricing power.
- Equity requirements: higher prices increase the absolute equity needed under 20 percent rules.
- Bank stress tests: affordability is assessed using significantly higher imputed rates than market levels.
Common mistakes in a shortage market
Zero rates can create a false sense of security. The most costly mistakes usually come from overly optimistic assumptions.
- Over-leveraging: buying at the maximum limit without buffers.
- No stress-test mindset: focusing on today’s rate instead of long-term affordability.
- Ignoring ongoing costs: maintenance, renovations and insurance are underestimated.
- One-size-fits-all structures: choosing fully SARON or fully fixed without risk alignment.
Practical positioning for 2026
Buyers planning to purchase or refinance in 2026 should focus on being finance-ready. Well-prepared buyers gain a clear advantage in competitive markets.
- Strengthen equity: more equity improves pricing and approval chances.
- Expand search areas: commuter regions often face less pressure.
- Use split strategies: balance SARON and fixed exposure.
- Clarify early: check affordability and documentation before serious viewings.
Next step: If you want a mortgage structure aligned with your budget and risk profile, review your numbers early and plan proactively.
Internal link: IMMANO mortgage overview
External reference: Swiss authorities on the 2026 housing shortage