The reference mortgage rate in leases remains at 1.25% (cross-border guide)

Context

In brief

• The reference mortgage interest rate remains at 1.25%
• The average interest rate is 1.31%
• The next update is scheduled for December 1, 2026

Key Facts

• What: Reference mortgage rate
• When: September 1, 2026
• Where: Switzerland
• Who: Federal Office for Housing (FOH)
• Amount: 1.25 %

The reference mortgage rate in Switzerland remains at 1.25%, as announced by the Federal Office for Housing (FOH) on 1 September 2026. This rate, which is decisive for determining rents throughout Switzerland, remained unchanged compared to the previous quarter. The average interest rate, calculated as at 30 June 2026, still stands at 1.31%. With commercial rounding, the reference mortgage rate therefore continues to be 1.25% and applies from 2 September 2026. It will remain at this level until the average rate falls below 1.13% or exceeds 1.37%.

Impact on Leases

Since 2 September 2025, the reference mortgage rate has been 1.25% and has remained unchanged compared to the previous quarter. Therefore, there has been no entitlement to rent increases or decreases since the last publication. If the rent is still based on a rate of 1.5% or higher, the entitlement to a rent reduction remains in principle.

About Lease Agreements

In most cases, the lease agreement or the latest rent adjustment notice provides information on the level of the reference interest rate on which the current rent is based. Rental contracts with indexed rents or graduated rents are excluded from these rules, as are rents on business premises that are subject to changes in turnover. In many cases, there is a special regime for so-called "supported housing".

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Operational details

Practical Analysis

Impact on the Real Estate Market

Maintaining the benchmark mortgage rate at 1.25% has significant implications for the Swiss real estate market. Rents, which are set based on this rate, remain stable, which can influence property purchase and rental decisions. Tenants who benefit from a rate below 1.5% will see no change in their rents, while those with a higher rate may see a reduction.

Comparison with Previous Period

Since 2 September 2025, the benchmark mortgage rate has remained unchanged at 1.25%. This means that rents have been stabilised for a whole year, offering tenants and property owners some predictability. The stability of the benchmark mortgage rate is a positive sign for the real estate market, which can benefit from greater certainty in the financial outlook.

Possible Scenarios

If the average interest rate were to fall below 1.13% or above 1.37%, the reference mortgage rate could be adjusted accordingly. This could lead to changes in rents, affecting both tenants and property owners. It is important for both parties to be aware of these possible changes and prepare accordingly.

Tips for Tenants and Landlords

For tenants, it is crucial to know the reference interest rate on which their rent is based. This can be checked in the lease agreement or in the latest rent adjustment notice. If the rate is above 1.25 %, a rent reduction can be requested. For landlords, it is important to monitor changes in the average interest rate and prepare for any adjustments to the reference mortgage rate.

Useful Tools

For more information and to calculate the impact of the mortgage reference rate on your rent, you can consult the website of the Federal Office for Housing (FOH) at the following address: www.tassodiriferimento.admin.ch.

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Key points

Action: What to do

Procedure for Rent Reduction

If the rent is based on a rate of more than 1.25%, you can request a reduction in the rent. The procedure involves the following steps:

1. Check the Reference Interest Rate: Check the lease or the latest rent adjustment notice to verify the reference interest rate on which the current rent is based. 2. Calculation of the Reduction: Determine the amount of the rent reduction based on the difference between the current rate and 1.25%. 3. Request the Reduction: Send a formal request to the owner of the property, attaching the necessary documentation. 4. Conciliation: If the landlord does not accept your request, you can contact the conciliation authority responsible for resolving the dispute.

Useful Tools and Resources

For more information and to calculate the impact of the mortgage reference rate on your rent, you can consult the website of the Federal Office for Housing (FOH) at the following address: www.tassodiriferimento.admin.ch.

Conclusion

Maintaining the reference mortgage rate at 1.25% offers some stability to the Swiss real estate market. However, it is important for tenants and landlords to be aware of possible future changes and prepare accordingly. Consulting available resources and following the correct procedures can help to better manage this situation.