Rising mortgage interest rates, falling prices for apartment buildings, houses and apartments. The new reality on the real estate market is causing uncertainty among homeowners. But change also offers new solutions and opportunities.
The headlines in the media have been alarming homeowners in recent weeks. “The real estate market is tipping”, headlines the NZZ am Sonntag. Schweiz am Wochenende” writes: “The fear of a crash is spreading”. For many years, the real estate industry seemed unshakeable. Prices for apartments, single-family homes and residential complexes could only go in one direction: upwards. But this trend is changing. Market prices for multi-family homes fell by a full 12.1 percent in the first quarter of this year compared to the previous year. Single-family homes and condominiums were somewhat less affected: According to the Federal Statistical Office, prices here fell by 1.3 and 1.1 percent respectively.
Highly competitive environment
The main reason for this development is the rise in mortgage interest rates, which had previously been at a historically low level. The inflationary environment is also contributing to this. The falling prices are countered by factors that are causing concern in the real estate sector: higher construction prices, increasingly complex building permits and neighbors who are more likely to object. The current population growth and the associated housing shortage are supporting the market and thus a possible fall in prices.
Nevertheless, rising mortgage costs are already putting some homeowners under pressure: they are having to consider selling their house or apartment – at a time when demand is falling due to higher interest rates. This means that they are faced with the new reality of the real estate market. The challenge is to position your property optimally in this highly competitive environment. During the peak of the real estate boom, homeowners were able to market their properties themselves. As a result, the highest possible sales price was sometimes waived. Losses that could be well compensated at the time due to the high real estate valuations.
Real estate expertise is in demand
In a volatile environment with falling real estate prices and lower demand, such an approach is no longer effective. The solution: Consult real estate experts – which a large proportion of owners already rely on: according to the “Handelszeitung” newspaper, only 12 percent of all real estate transactions are now carried out directly between private individuals. 88 percent of sales are accompanied by brokers.
This development is understandable. As a private individual, you may only buy or sell a property once in your life, as real estate expert Adrian Künzi, co-founder and CRO of Properti, points out. “This makes it all the more important to provide individual all-round advice based on expertise, transparency and the technical possibilities of today, which in turn produces measurable and reliable results. According to Adrian Künzi, brokers should be able to invest as much time as possible in advising clients.
The 360-degree service
But the real estate company, which is active throughout Switzerland, offers even more. “Today, the real estate industry is no longer just about selling a property or finding suitable buyers or tenants. What is needed is comprehensive support that includes a holistic perspective. We offer this 360-degree service,” says Künzi. This includes a clear overview of the complex market and legal issues, carefully prepared budgets, effective marketing strategies and targeted negotiating skills that are used to the benefit of clients.
The first viewing takes place via a virtual 360° tour in order to filter out the serious potential buyers and save the owners time and nerves. The company also serves as a platform that covers all matters relating to real estate, including the procurement of removal companies, cleaning companies and household insurance as well as financing solutions. The key thing for Properti customers is that they only have to pay a commission if a transaction is actually concluded – without entry and activation fees, expense allowances or monthly costs.
Time for a new strategy
As a property owner, now is the time to rethink and adjust your strategy. It is more important than ever to keep an eye on the latest market developments and marketing trends in order to make informed decisions. If you are thinking about selling or are generally unsure about the current situation, you should get together with a real estate expert who can provide optimum support in all processes relating to letting, management or marketing.
Excerpt from “der Hauseigentümer” (HEV Switzerland) from September 1, 2023. You can find more publications in our newsroom.
