Interest rate expectation

Basel, 21.01.2025

Swiss Mortgage Market: Interest Rate Trends and Implications for Borrowers

The Swiss interest rate environment has been evolving steadily. While Europe and the US have seen sharp increases, Switzerland’s rates have remained more stable. This creates opportunities and challenges for mortgage seekers.

Key Insights for the Mortgage Market:

1. Swiss National Bank (SNB) Interest Rates
   In December, the SNB unexpectedly lowered its key rate to 0.5%. Experts predict further cuts to 0% or even negative rates this year due to low inflation. These changes directly impact bank refinancing costs and, consequently, mortgage rates.
2. Fixed-Rate Mortgages and Swap Rates
   The swap rate, a critical benchmark for fixed-rate mortgages, is currently low. Forecasts suggest it may decrease in the short term before experiencing a moderate rise. This provides an opportunity for borrowers to secure affordable mortgage rates.
3. Global Influences on the Swiss Mortgage Market
   While global markets face rising rates, Swiss yields remain steady. This stability makes Swiss mortgages comparatively attractive.

What Does This Mean for Borrowers?

• Mortgage Comparison is Crucial: With fluctuating swap rates, bank offers can change rapidly. Using mortgage calculators helps identify the best deals.
• Secure Low-Cost Mortgages: Fixed-rate mortgage seekers should capitalize on current low rates before potential increases.
• Monitor Market Trends: The possibility of negative rates could make financing even more appealing for homeowners and investors.

The current market situation presents opportunities. Contact us for your mortgage comparison.