Rents in Switzerland: 32% increase in twenty years

Context

TL;DR

• Rents have risen by 32% in 20 years
• The index grew by 32,1% between 2005 and 2025
• The reference rate is 1,25%
• Gross incomes of up to 4'000 francs: 37,8% goes toward rent

Key facts

• Organization → Swiss Tenants' Association (ASI)
• Location → Bern
• Renting in Switzerland → two thirds of households
• Rent index → 32,1% between 2005 and 2025
• Reference rate → 1,25%
• Gross income → up to 4'000 francs, with 37,8% allocated to rent
• OECD comparison → one low-income family out of two exceeds 40%
• Investment companies → 28,7% in 2000 and 44,4% in 2024

ASI's position

Rents in Switzerland have increased by about 32% over the past 20 years, according to the Swiss Tenants' Association (ASI). In Bern, on the occasion of International Tenants' Day, the organization drew attention to the financial burden weighing on tenants and called for measures to be adopted.

The scope is national: according to ASI, two thirds of households live in rented accommodation. For those who pay rent, the issue therefore enters costo della vita in Svizzera, but the association's criticism concerns above all the gap between the trend in interest rates and that of rents.

Between 2005 and 2025, the rent index grew by 32,1%. During the same period, mortgage rates reached an all-time low. The reference rate currently stands at 1,25%. Since rents are legally indexed to this rate, many should have decreased. According to ASI, however, they continued to rise.

The pressure particularly affects low- and middle-income households. People whose gross income does not exceed 4'000 francs allocate 37,8% of their income to rent. OECD data for eight countries, including Switzerland, also show that one in two low-income renting families allocates more than 40% of its disposable income to rent. Affordable housing is meanwhile becoming rarer.

ASI's analysis also records a change in ownership of rental housing: the share belonging to private individuals fell from 57,3% in 2000 to 43,2% in 2024, while that of owner investment companies rose from 28,7% to 44,4%. According to the association, these companies achieved high returns through the real estate sector.

ASI calls for a change of course, the application of the cost-based rent principle, a strengthening of the Lex Koller to curb the influx of financial capital into the residential market, and more public-interest housing. It also criticizes the indirect counterproposal envisaged by the Federal Council in response to the Rent Initiative: according to the association, it would lead to an even more marked increase in rents.

Operational details

The comparison that weighs on family budgets

The shift from predominantly private ownership to a broader presence of investment companies is one of the key figures that allows us to read the market beyond the overall increase in rents. The shares indicated by the ASI are as follows:

Between 2000 and 2024, therefore, the share of housing belonging to private individuals decreased, while that of investment companies increased. The ASI links the latter to high returns in the real estate sector. This data does not quantify the rent of each individual home, but describes a transformation of the ownership structure that the association associates with the scarcity of accessible housing.

Two different bases for measuring the burden

Pressure on families must be read by separating two metrics. The first concerns people with a gross income of up to CHF 4,000: according to the ASI, 37.8% of their income is allocated to rent. The second comes from the OECD comparison across eight countries, including Switzerland: one in two low-income tenant families spends more than 40% of their disposable income on rent.

The two percentages do not describe the same audience nor the same calculation basis. The 37.8% refers to the gross income of people below the indicated threshold; the 40% concerns the disposable income of low-income families in the international comparison. Separating these indicators avoids adding them together or using them as if they were identical. To organize the comparison between gross income and disposable income, one can start from the Swiss payslip.

Even the reference interest rate remains a point to verify. The source recalls that rents are legally indexed to this rate and that many, with the value at 1.25%, should have decreased. The fact that they have instead continued to grow is the crux highlighted by the ASI. Since two-thirds of households live in rented accommodation, the problem does not affect a marginal segment, but a large component of Swiss families. The combination of income burden, scarcer accessible housing, and changing ownership explains why the association is calling for political intervention.

Useful tools to protect your net income

To reduce FX leakage, compare CHF-EUR exchange options and banks for cross-border workers.

Key points

Four steps to understand the problem

To turn the data into a personal assessment, it is useful to follow a simple sequence and keep the quantities used by the source separate.

Income first, then rent

1. Separate the calculation bases. Record gross income and, separately, disposable income. The source uses the former as the reference for people whose income does not exceed 4'000 francs and the latter in the OECD comparison. Confusing the two values leads to an imprecise assessment of the rent burden.

2. Measure the share allocated to housing. For the gross-income bracket indicated by ASI, the reference is 37,8% of income allocated to rent. When disposable income is used, OECD data indicate that one in two low-income renter households exceeds 40%. The two thresholds serve to interpret different situations.

3. Distinguish proposals from measures already announced. ASI calls for the application of cost-based rent, strengthening Lex Koller to curb the inflow of financial capital into the residential real-estate market, and a larger number of public-interest housing units. These are the demands put forward by the association, not individual procedures described in the source.

4. Follow the federal political process. ASI criticizes the indirect counterproposal planned by the Federal Council in response to the Rent Initiative and argues that it would cause an even more pronounced increase in rents. This is the institutional point to watch when assessing the evolution of the national framework.

This sequence makes it possible to link the rent burden to the correct income, distinguish the Swiss comparison from the OECD one, and identify which interventions are ASI demands. To complete the calculation of disposable income and taxes, use calcolatore stipendio/imposte.

Source: tio.ch