Content:

  • Review: Home prices rose by 0.9 percent in the second quarter of 2025 compared to the previous quarter.
  • The Swiss Real Estate Bubble Index: The ÃÛ¶¹ÊÓƵ Swiss Real Estate Bubble Index increased slightly in the second quarter of 2025 but continues to indicate a moderate bubble risk in owner-occupied housing.
  • Risk map: The analysis shows a bubble risk in the tourist regions of Graubünden.
  • Outlook: The prices of residential properties are likely to increase by 3.5% this year.
The price development on the real estate market is expected to stabilize at a high level in the coming months.

Development of real estate prices in Switzerland

Owner-occupied housing became significantly more expensive in the second quarter, with a nominal increase of 0.9 percent. Year over year, home prices rose 3.7 percent — the highest in more than two years — while consumer prices stagnated.

Momentum in the rental housing market has slowed considerably. Asking rents stagnated in Q2 and are now 1.3 percent above last year’s level. Existing rents rose 2.6 percent year over year. However, the reference interest rate, which fell in March 2025, is likely to dampen the increase in the coming quarters.

 

ÃÛ¶¹ÊÓƵ Swiss Real Estate Bubble Index in the 2nd quarter of 2025: moderate

The ÃÛ¶¹ÊÓƵ Swiss Real Estate Bubble Index rose to 0.38 index points in the second quarter of 2025, up from 0.29. The risk of a real estate bubble is still considered moderate. A price correction in the coming quarters appears unlikely.

What is the ÃÛ¶¹ÊÓƵ Real Estate Bubble Index and how is it calculated?

The ÃÛ¶¹ÊÓƵ Swiss Real Estate Bubble Index shows the risk of a real estate bubble – a significant overvaluation of real estate and the likelihood of an imminent price drop – on the Swiss real estate market. ÃÛ¶¹ÊÓƵ economists use a model with different subindices to calculate the bubble index: 

  • price-to-rent and price-to-income ratios (foundation)
  • real rate of price change over three and 10 years (dynamics)
  • cost comparison of purchase and rent (cost)
  • mortgage volume-to-income and residential construction (environment)

Depending on the current index value, the real estate bubble risk is divided into the following four categories:

  • low (below 0)
  • moderate (between 0 and 1)
  • elevated (between 1 and 2)
  • acute (above 2)

The graph shows the risk of a real estate bubble over the last 40 years. In 2025, the Swiss Real Estate Bubble Index is stated between 0 and 1, which corresponds to the assessment of moderate.

Download our detailed analysis now

The more you know, the more you understand: you’ll find our complete analysis of the Swiss housing market in the latest issue of the Swiss Real Estate Bubble Index.

The risk map shows in which municipalities the real estate market is at risk of overheating

The map shows price developments over the last five years for all 106 Swiss economic regions, as well as an indication of regional risk based on the development of the price-to-income and price-to-rent ratios.

  • Significant imbalances exist almost exclusively in the tourist regions of Graubünden, a consequence of the second-home boom and limited supply.
  • In Western Switzerland, elevated imbalances are found in the regions of Lausanne and Yverdon. In the Geneva region, there is no elevated imbalance due to recently below-average price development.
  • In the primary residence markets of German-speaking Switzerland, a significant imbalance is seen only in the Einsiedeln region.
  • In most regions, the ratio of purchase prices to rents has decreased over the past year, while the ratio of purchase prices to incomes has in some cases increased significantly.
Real estate prices in different regions in Switzerland are compared with rental prices. The resulting map shows which regions are at risk of a real estate bubble.
Source: ÃÛ¶¹ÊÓƵ. Imbalances: very high: change in the price-income and price-rent ratios greater than in 90 percent of the regions. High: change in the price-income and price-rent ratios greater than in 75 percent of the regions.

What is the forecast for the development of the real estate market in Switzerland?

Despite attractive financing conditions, a slowdown in home price increases is expected in the coming quarters. Economic growth in Switzerland is at risk of losing further momentum due to US tariffs. Rising uncertainty regarding jobs and incomes is likely to negatively impact demand for homeownership. By the end of 2025, prices are expected to be about 3.5 percent above the level at the start of the year. For the years 2026 and 2027, we anticipate a slight slowdown in price increases to 2 to 3 percent due to the strained affordability of homeownership. However, not all regions are likely to benefit equally from value gains.

Regional price outlook

The best conditions for above-average price increases - measured by local demand surplus, momentum, and relative price level in the residential property market - are found in Upper Valais, the Bernese Oberland, Chur, Lucerne, and Schaffhausen. Our analyses indicate below-average price development around Lake Geneva, along the Jura Arc, and in Northwestern Switzerland.

Map of regions with the highest and lowest expected future prices.
Source: ÃÛ¶¹ÊÓƵ. Regions with the highest and lowest expected future price development.

The facts about your preferred municipality

Do you want to understand how property prices or population levels have changed in a municipality? Or how the location is perceived in general? How high are taxes? The ÃÛ¶¹ÊÓƵ municipality guide is free of charge and answers all your questions.

FAQ real estate prices and real estate market

Good to know

Disclaimer

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