Real estate market: highly sought-after houses, offices preferably in the city
Banca Migros - 20. Settembre 2021
The prices of condominiums and single-family homes will continue to rise next year. Expectations for the office market, on the other hand, will remain contained. This is demonstrated by CSL's 2021 summer survey on the real estate market.
CSL Immobilien's summer survey of the office and residential real estate market * comes to a clear conclusion on one point: next year, condominiums and single-family homes in central locations in Zurich, Basel, Bern and Lugano will remain firmly scarce and therefore expensive. For the vast majority of tenants, the dream of owning their own home in urban areas has become unattainable.
Living in cities will become even more expensive
Strong demand, still fueled by low mortgage rates, is met with a notoriously scarce supply in the cities. It is almost no longer possible to build new buildings in urban locations, either because there is a lack of space or because it is practically impossible from the point of view of building law. And if a three or four-room apartment arrives on the market after a renovation or a change of tenants, for many middle-class people the offer is difficult to access.
Most industry players expect the housing market in cities to be heavily dominated by small-sized homes in the future. In this sense, apartments with 1.5 or 2.5 rooms are considered typical offers of urban life. It follows a geographical shift: in the future, the most consistent demand for large houses (at least 4.5 rooms) is clearly seen by experts in urban agglomerations and rural areas.
Single family homes in demand
The sector operators interviewed in the context of the study assume that single-family homes will be hit by an inflationary push practically on the entire territory. Because what many families and multi-person households cannot find in the city and in the agglomeration, they look for in rural areas instead: most multi-person households and households accept slightly longer distances and look for more suitable housing. , that is, more spacious, in rural regions. These are often single-family houses, but also semi-detached and single-family terraced houses. In the wake of this demographic movement, experts are also observing an increase in the prices of residential properties in rural areas.
The persistent and consistent demand for larger properties and more space has to do with social change and the pandemic. The number of people working from home continues to increase compared to the past. Teleworking requires more space and often more premises than city apartments offer. Of course, it would be wrong to think that people don't like living in the city. But the balance of the market is such that the respective desires for generous living spaces and a sufficient number of premises can only be realized in rural communities.
*) Source: CSL summer 2021 survey on the office and residential property market. CSL Immobilien, the real estate partner of Migros Bank, interviewed around 300 real estate operators, including corporate executives, portfolio managers and service providers from the sector.