The Swiss market for private real estate has dried up. The scarce supply meets a huge demand. So far, not even the massive price jumps and rising mortgage interest rates have been able to change anything.
A ray of hope for everyone who still dreams of owning their own four walls: in the next 23 years, several hundred thousand homes will become vacant. These are all the houses that are currently inhabited by the baby boomer generation.
Owning your own home becomes a burden
Baby boomers include anyone born in the baby boom years from 1946 to 1964. In the next few years, the generation that has the highest percentage of homeowners will leave working life with them. Figures from Credit Suisse show that baby boomers currently own more than 40 percent of all homes in Switzerland.
These properties will come onto the market in the next few years. “Because experience shows that single-family homes become a burden from a certain age,” says Fredy Hasenmaile (55), real estate expert at Credit Suisse (CS). At some point the house is too big, there is too much to clean and repair.
That’s why many baby boomers sell their homes in the time between retirement and entering a nursing home. And this is exactly the period of time before us.
Every year more houses become vacant
How many homes in Switzerland will this free up? Credit Suisse evaluated the data exclusively for Blick. These are impressive: Spread over the next 23 years, a total of over 419,000 homes will become vacant because pensioners move out or die.
The number of houses that come onto the market in this way will increase every year from now on. If there are still 3,500 houses in 2023, according to CS calculations, there will be more than 40,000 homes in 2045.
“This demographic development will help to ease the situation on the real estate market,” says Hasenmaile. Even if it cannot completely solve the problem of the dried-up housing market.
Real estate stays in the family
It is not clear how many of these homes actually end up on the open market. Changes of ownership of properties financed by the Zürcher Kantonalbank show, for example, that almost every second family home in the canton of Zurich remains within the family.
If the situation is similar in the rest of Switzerland, around 200,000 houses will change hands within the family in the next few years.
One thing is clear: the family plays an increasingly important role when buying a property. On the one hand, because the house is passed on within the family. On the other hand, because young families are increasingly dependent on the financial support of their parents when buying a house.
Because without rich parents, buying a house is almost impossible today. Donations and inheritance advances have become a necessity on the Swiss real estate market in order to be able to afford a house. Luck, then, is whoever inherits a house. Unfortunately, for many, the noise also begins with the inheritance.
In a multi-part series, Blick sheds light on topics relating to the heritage of real estate.