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What will happen in Zurich’s real estate market? Will prices continue to rise, or are we expecting a downturn? Is Zurich still a prime location for international investors? How are local government policies and taxes shaping the real estate landscape in 2025?
We’re frequently asked these questions because of our deep involvement in this market. Through our collaborations with real estate agents, property developers, and clients purchasing homes in Zurich, we’ve gathered firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
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1) Owning multiple homes in Zurich will become less appealing due to changes in property tax laws, affecting investor strategies
In 2023 and 2024, Zurich saw significant changes in property tax laws, which have made owning multiple homes less appealing for investors. The revaluation of properties in Zurich led to an average increase in property tax values by 49%, which means that homeowners now face much higher tax bills than before.
This increase in property tax values is coupled with a rise in imputed rental values, which went up by an average of 11% for single-family homes and 10% for condominiums. These changes mean that the cost of owning multiple properties has increased, reducing the profitability for investors who own several homes.
Additionally, the Zurich Finance Director highlighted that these changes were necessary due to court rulings that found many properties were undervalued. This revaluation is expected to bring more revenue to the canton but also increases the financial burden on property owners, making it less attractive for investors to hold multiple properties.
Sources: Bluewin, Tax Partner
2) Rents in Zurich will rise as the population grows and housing remains scarce
Zurich's population is on the rise, with 1,443,000 people in 2024 and more expected in the coming years.
This growing number of residents means more people are hunting for homes, pushing up the demand for housing. But here's the catch: Zurich's housing supply isn't keeping pace. The national vacancy rate in Switzerland is shrinking, with fewer than 52,000 apartments sitting empty by mid-2024, which is just 1.08% of the total housing stock.
In Zurich, the situation is even tighter. The city has very low vacancy rates, making it tough to find affordable places to live. Even though there was a 22% jump in building applications in 2024, it's unclear if these will translate into new homes anytime soon. High-density construction challenges and limited land availability are slowing things down.
This ongoing shortage in supply, combined with the rising demand, has led to significant rent increases. In 2023, asking rents in Zurich shot up by 13.3%, and this trend is expected to continue. The limited housing supply and growing population are key factors driving these rent hikes.
For those considering buying property in Zurich, it's important to understand the dynamics at play. The city's appeal and economic opportunities are drawing more people, but the housing market is struggling to keep up. This imbalance is likely to keep pushing rents higher.
So, if you're thinking about investing in Zurich's property market, be prepared for a competitive environment. The combination of a growing population and limited housing supply means rents are likely to keep climbing.
Sources: Swissinfo, Macrotrends, Noel Barino Substack, Swiss Marketplace Group
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Switzerland versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
3) Luxury rental yields in the city will rise as expat demand increases
Zurich is becoming a hotspot for expatriates thanks to its booming job market.
Big names like Google are setting up shop in Zurich, bringing in employees who earn high salaries and are on the lookout for luxury accommodations. These professionals are not just looking for a place to stay; they want top-notch amenities and services that match their lifestyle.
It's not just tech giants making waves; international law firms, insurers, and accountancy firms are also relocating to Zurich. This influx of businesses means more employees are moving in, further boosting the demand for high-end rental properties. Real estate agencies are buzzing with activity as they try to meet this growing need.
But here's the catch: Zurich's luxury rental market is facing a shortage of high-end properties. As of mid-2023, finding a new-build apartment is like finding a needle in a haystack. The vacancy rate is incredibly low, which means there's not much available for those eager to rent.
This scarcity, paired with the rising demand, is causing rental prices for luxury apartments to climb. If you're considering a move to Zurich, be prepared for a competitive market where prices are on the rise.
For those looking to invest, this could be a golden opportunity. With the demand from expatriates showing no signs of slowing down, the city's luxury rental market is poised for a yield increase.
Sources: LVH Global, AM Relocation, Swissinfo
4) Rental yields in Zurich will fall as property prices rise faster than rents
Rental yields in Zurich are expected to keep declining because property prices are rising much faster than rents. In the past, from 2013 to 2022, apartment prices in Zurich increased by over 42%, while single-family homes saw a similar rise. This trend continued into 2023, with the average asking price for an apartment reaching 17,196 Swiss francs per square meter.
On the other hand, rent growth has been much slower. Between 2000 and 2021, average rents in Switzerland only went up by 30%, and in Zurich, the rent index increased by just 4.8% in late 2023. This means that while property values are soaring, rents are not keeping up at the same pace.
Real estate agencies have reported that even though rents are rising, they are not matching the rapid increase in property prices. This is partly due to a very low vacancy rate of 0.58% in Zurich, which indicates a housing shortage. While this allows landlords to charge higher rents, it doesn't necessarily lead to higher rental yields because the cost of buying property is so high.
Sources: SwissInfo, Business Insider
5) Rental yields in central Zurich will stay steady as demand for city living remains high
Rental yields in central Zurich are expected to remain stable due to the strong demand for city living. This demand is driven by several key factors that have been consistent over the past few years.
Firstly, the population of Zurich has been steadily growing, largely due to immigration. In 2023, net immigration reached 98,900, and by early 2024, an additional 21,500 immigrants arrived. This influx of people has significantly boosted the demand for rental housing, as more individuals and families seek accommodation in the city.
Moreover, the vacancy rate in central Zurich is extremely low, at just 0.06% as of June 2023. Such a low vacancy rate indicates that properties are quickly absorbed, which naturally leads to higher rental prices and stable yields. This trend is further supported by the consistent increase in rental prices in the canton of Zurich, which have risen by 12% since 2005.
Additionally, Zurich's strong economic performance and job market contribute to the high demand for housing. The stable employment outlook and ongoing job creation make Zurich an attractive place to live and work, further supporting the demand for rental properties.
Sources: AM Relocation, Swissinfo, Engel & Völkers
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6) Mid-range property prices in Zurich will dip slightly due to affordable housing projects
In Zurich, the City Council has invested 300 million francs in affordable housing for 2023 and 2024.
This hefty investment covers buying land, building new apartments, and renovating older housing associations. The goal is clear: boost the supply of affordable housing in the city. With more affordable options popping up, people are likely to shift their focus away from mid-range properties.
As living costs and inflation rise, household budgets are getting tighter. Many potential buyers are now looking at affordable housing as a more viable option. This change in preference is expected to reduce demand for mid-range properties, which might lead to a slight dip in their prices.
Looking at other cities, we see a pattern: when affordable housing increases, mid-range property prices often stabilize or even drop. Zurich is no exception. Programs like "Housing First" and cooperative housing models are actively working to address the affordable housing shortage, reinforcing this trend.
These initiatives are not just about building more homes; they're about creating a sustainable housing market. By focusing on affordability, Zurich is setting a precedent that could reshape the real estate landscape in the city.
Sources: IAmExpat, Oaks Group, Swissinfo
7) Property prices in Schwamendingen will rise as new public transport links enhance accessibility
Schwamendingen is set to see a rise in property prices thanks to new public transport links.
In Zurich, neighborhoods often experience a boost in property values when public transport improves. Schwamendingen is no different, as it's currently undergoing infrastructure upgrades. Historically, areas with better transport links have seen positive trends in property values, and Schwamendingen is expected to follow this pattern.
The Zurich city council has greenlit plans to expand the tramway network through 2040, including new subways and tram lines. This expansion aims to ease congestion and offer more mobility options, making Schwamendingen more accessible and attractive to potential residents. As a result, property prices in the area are anticipated to rise.
Real estate market analyses predict growth in Schwamendingen due to its improving accessibility. The neighborhood's proximity to key transport hubs like the Mattenhof tram station and Stettbach regional rail station is making it increasingly popular. This growing interest is a strong indicator of potential property price increases.
Urban planners and economists often highlight that improved public transport links significantly enhance a neighborhood's appeal, leading to increased property values. Better connectivity makes areas more desirable for both residents and investors, and Schwamendingen is poised to benefit from this trend.
Sources: RealAdvisor, Mainspring, UBS
8) Property price growth in Oerlikon will slow down because recent developments have led to oversupply
In 2023, Zurich saw a surge in new apartment constructions, especially in the Oerlikon district.
The city council's decision to revise the Neu-Oerlikon building regulations has paved the way for 400 to 500 new apartments. This move is part of a broader trend of increased building activity, which might lead to an oversupply of housing in the area.
With so many new properties hitting the market, there's a buzz that the real estate scene is shifting. Experts suggest that the market might be transitioning from a seller's to a buyer's market, giving potential buyers more leverage.
This shift could mean that property price growth in Oerlikon might slow down. Buyers might find themselves in a stronger position to negotiate, which is a change from the usual fast-paced market dynamics.
For those considering buying in Zurich, especially in Oerlikon, this could be an opportunity. The potential oversupply might offer more choices and better deals for buyers.
Keep an eye on these developments, as they could significantly impact your buying strategy in the coming months.
Sources: IAmExpat, Julius Baer, Immo-Invest
We have made this infographic to give you a quick and clear snapshot of the property market in Switzerland. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
9) Luxury rents in Zurich will rise as more wealthy individuals relocate to the city
The luxury rental market in Zurich is on the rise as more wealthy individuals flock to the city.
Over the past few years, Zurich has become a magnet for millionaires, thanks to Switzerland's political, financial, and social stability and its attractive tax environment. This influx is pushing up demand for high-end rentals.
In 2023, Zurich's rental apartment vacancy rate was a mere 0.58%, highlighting a severe housing shortage, especially in busy urban areas. This scarcity is a major driver of the demand for luxury rentals.
Luxury property prices in Zurich have remained strong, staying 25% above pre-COVID levels in 2023. This consistent appreciation makes renting an appealing option for newcomers.
Real estate agencies are seeing a spike in rental inquiries, particularly for luxury properties, as wealthy newcomers show a clear preference for renting. Zurich's thriving economy, especially its financial sector, continues to draw talent from around the globe.
The presence of international businesses and executives in Zurich adds to the city's allure, further boosting the luxury rental market. Zurich's appeal is undeniable for those seeking a vibrant and stable environment.
Sources: Chambers, Global Property Guide
10) Property values in Höngg will rise steadily as the area becomes more appealing to families
In recent years, the Höngg area has become increasingly attractive to families, leading to a steady rise in property values. One of the key factors contributing to this trend is the significant improvement in public transportation links. Zurich has been expanding its public transport network, focusing on efficient and electrified options, which makes commuting to the city center much easier for families. This enhancement in connectivity has greatly improved the area's livability.
Additionally, the area has seen a rise in family-friendly amenities, such as parks and playgrounds. These amenities provide families with ample recreational opportunities, making the neighborhood more appealing. For example, places like Blatterwiese playground and Josefwiese offer various activities for children, which are highly favored by local parents. This increase in amenities is a clear indicator of the area's growing family-friendly environment.
Moreover, there has been a noticeable development of new residential projects targeting families. Projects like Greencity Zürich focus on sustainability and innovation, offering eco-friendly living spaces that cater specifically to family needs. This type of development shows a commitment to creating a welcoming environment for families, further boosting the area's attractiveness.
Sources: Urban Transport Magazine, Lonely Planet, Engel & Völkers
11) Rents in Zurich's outskirts will drop slightly as new housing developments boost supply
In 2023 and 2024, Zurich's outskirts experienced a boom in building permits, with 9,300 permits issued in the first quarter of 2024.
This surge in permits is a clear sign of a growing housing supply, especially with projects like the Spiserstrasse development in Zurich Albisrieden, which will add 100 new apartments by mid-2025.
These new housing projects are part of a broader effort to expand living options, and Wüest Partner forecasts that 39,000 new homes will be available by 2025, including condos and rentals.
Such an influx of new homes is expected to stabilize rents, a trend already seen in other Swiss cities like Geneva, where increased housing supply has helped keep rent prices in check.
For potential buyers, this means more choices and potentially better deals, as the market adjusts to the increased availability of housing.
As new developments continue to rise, especially in Zurich's outskirts, it's likely that rents will experience a slight decline, making it an opportune time to consider investing in property.
Sources: Allreal, UBS, IAmExpat
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12) Virtual reality tours will change property viewings in Zurich as they become a common tool for buyers
Virtual reality tours have become a common tool for property viewings in Zurich, fundamentally changing how buyers interact with the market. This shift is largely due to the increased adoption of VR technology in real estate globally, with the Swiss market showing a strong interest in immersive experiences. By 2029, the number of users in the AR & VR market in Switzerland is expected to reach 7.7 million, indicating a significant penetration of this technology.
Consumer surveys have shown a clear preference for virtual property tours, with over 50% of adults having taken a virtual tour and 67% of home buyers expressing a desire for such tours when looking at listings. This preference is supported by advancements in VR technology, such as the Apple Vision Pro, which offers high-quality visuals and sound, enhancing the emotional connection buyers feel with properties.
Real estate agencies in Zurich have started to offer VR tours, leveraging this technology to provide detailed and engaging property explorations. Success stories from companies like Graphex demonstrate that homes with virtual tours sell faster and attract more views, with buyers spending significantly more time on listings that include these tours. Additionally, the growing number of tech-savvy buyers in Zurich, particularly those aged 18 to 34, are more likely to engage with properties that offer virtual tours, further driving this trend.
Sources: EWM Swiss Blog, Statista Market Forecast, PhotoUp Real Estate Virtual Tour Statistics
13) Foreign buyers will increasingly seek eco-friendly properties as sustainability gains importance
In recent years, we've seen a noticeable shift in the real estate market towards eco-friendly properties, especially in places like Zurich. This change is largely driven by the increasing awareness and concern for sustainability and environmental responsibility. For instance, Zurich's participation in international sustainability initiatives has shown a strong commitment to sustainable development, which naturally attracts foreign buyers who prioritize eco-friendly living.
Moreover, the growing number of real estate listings that highlight sustainability features, such as the use of renewable energy sources and efforts to reduce greenhouse gas emissions, reflects a broader trend in the market. Companies like Zurich Invest AG have been at the forefront of this movement, emphasizing sustainable building management and aligning with the global push for greener practices.
Additionally, the Swiss Sustainable Investment Market Study 2024 has highlighted the urgent need for decisive action against climate change, which has influenced property investment discussions. This has led to an increase in sustainability-related investments and a focus on sustainable real estate funds, further driving the demand for eco-friendly properties among foreign buyers.
Sources: MDPI, Greater Zurich Area, Sustainable Finance, Zurich Invest
14) Investment properties in Zurich will decrease due to stricter short-term rental regulations
Zurich is tightening its grip on short-term rentals, much like Valencia and the Canary Islands have done.
These new rules mean that only 10% of apartments in residential zones can be rented out as furnished short-term rentals. So, if you're thinking of investing in Zurich's short-term rental market, know that 90% of these apartments must be rented as regular homes, which really limits your options.
Investors are starting to feel the heat. A survey by EY shows that while Switzerland is still attractive, there's a growing concern about regulatory risks that might make investors think twice about short-term rental properties.
Look at Lucerne, where short-term rentals are capped at 90 days a year. This move is meant to free up housing for locals. If Zurich keeps going down this road, expect a dip in properties aimed at short-term rentals.
Real estate agencies are noticing a shift. Investors are steering clear of cities with tough rules. The Julius Baer report points out that these regulatory hurdles are stifling development, which could further push investors away from Zurich's short-term rental scene.
Sources: Integra Dom, Julius Baer, EY, IAmExpat
We made this infographic to show you how property prices in Switzerland compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
15) Demand for sustainable homes in Zurich will rise due to new tax incentives for energy efficiency
In 2023 and 2024, the Swiss government introduced the Climate and Innovation Act, which set ambitious goals for reducing greenhouse gas emissions in the building sector. This act aims for climate neutrality by 2050, with specific targets to cut emissions by 82% by 2040 and 100% by 2050. These government incentives are designed to encourage the development and purchase of energy-efficient homes, making them more attractive to potential buyers.
In Zurich, there has been a noticeable trend towards sustainable construction, as seen in projects like the Think Earth initiative at ETH Zurich. This project focuses on regenerative construction using timber and earth, which helps reduce waste and carbon emissions. Additionally, the Swircular project is creating a digital ecosystem for circular construction, promoting sustainable practices by tracking materials throughout their life cycle. These efforts highlight the growing emphasis on sustainability in the construction industry.
Moreover, the introduction of new standardized real estate products like "Cabanne" and "Casitta" by Implenia in Zurich-Seebach demonstrates a shift towards faster and more sustainable residential construction. These products aim to reduce planning time and increase construction quality while ensuring sustainability. This shift is further supported by the increasing availability of green mortgages, which provide financial incentives for purchasing sustainable homes, making them more accessible to a broader audience.
Sources: ETH Zurich, Implenia, Sustainable Finance
16) Property prices in Zurich will keep rising because of limited land and high demand
Zurich's residential property prices are steadily climbing, and this trend shows no signs of slowing down.
One big reason for this is the limited land available for new developments. Zurich's strict zoning laws and building regulations make it tough to find space for new construction, especially in the city center. This scarcity naturally pushes property values and rents higher.
Another factor is the increasing population and urbanization. Zurich's strong economy and high quality of life attract many professionals and families, leading to a growing demand for housing. This influx of new residents further boosts the demand for residential properties, pushing prices higher.
Zurich's status as a global financial hub also plays a role. The city's robust economy and low unemployment rates continue to attract professionals and expatriates, increasing the demand for residential properties. This high demand, coupled with limited supply, results in low vacancy rates, allowing landlords to charge premium rents.
Geographical constraints like lakes and mountains limit Zurich's expansion possibilities. This lack of space for new developments exacerbates the housing shortage, further driving up property prices. The combination of these factors, including limited land availability, high demand, and geographical constraints, suggests that Zurich's residential property prices will continue to rise.
In short, Zurich's property market is a classic case of high demand meeting limited supply. With its attractive lifestyle and economic opportunities, the city remains a magnet for new residents, ensuring that the demand for housing stays strong.
Sources: Archova Visuals, Oaks Group SA
17) Demand for modern apartments in central Zurich will rise as more young professionals move in
Zurich has been experiencing a significant rise in employment opportunities, particularly in the tech and finance sectors. This growth has attracted many young professionals to the city, seeking high-paying jobs and a vibrant urban lifestyle. As a result, the demand for high-end properties, especially luxury apartments in central districts, has surged, with prices reaching impressive heights.
In addition to job opportunities, Zurich's educational institutions, like ETH Zurich, have seen a notable increase in student enrollment. In 2024, there was a 13% rise in Bachelor's students, indicating a growing influx of young adults who are likely to remain in the city after graduation, further boosting the demand for modern apartments.
Moreover, Zurich's appeal is enhanced by its multicultural and lively atmosphere, making it a popular choice for young professionals and students. The city's investment in infrastructure and public transport developments has also made it more accessible and attractive, contributing to the high demand for housing in central areas.
Sources: Nestpick, ETH Zurich, Oaks
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.