Mortgage Barometer 2025: how is the mortgage market developing?
Discover mortgage trends with the Comparis Mortgage Barometer. Analysis of the 4th quarter 2024 shows Saron mortgages in particular have become significantly cheaper.
09.01.2025
iStock / piovesempre
1. How have mortgage rates changed?
Interest rates for fixed-rate mortgages have been falling since June 2024. Saron mortgages in particular have fallen again significantly since the interest rate cut to 0.5%.
The benchmark rate for 10-year fixed-rate mortgages fell from 1.81 to 1.63% in the fourth quarter (as of 31 December 2024) – with an interest rate range of approximately 1.1 to 1.7%. For comparison: in September 2024, they cost 1.5 to 2.0%..
The benchmark interest rate for 5-year fixed-rate mortgages has fallen from 1.68 to 1.44% (as of 31 December 2024) since the end of September 2024. The average interest rate range is around 1.0 to 1.5%.
At the beginning of the year, the benchmark rates for 10-year and 5-year fixed-rate mortgages were 2.26% and 2.13% respectively..
Saron mortgages have been reduced by around 1.25 percentage points after the four key interest rate cuts in 2024. First-rate Saron mortgages currently cost around 1.1 to 1.6% on average.
4 out of 5 mortgage holders chose long-term fixed-rate mortgages. In addition to high planning security, attractive conditions are likely to have contributed to this decision.
2. Current mortgage rates in Switzerland
Mortgage rates vary significantly depending on the type of mortgage, term, lender, canton, loan-to-value ratio and affordability.
Comparis compared the average differences between the benchmark rate and the top interest rate of the Comparis mortgage partner HypoPlus. The comparison revealed a considerable savings potential.
Savings potential when taking out a mortgage
The interest rates actually negotiated are often below the benchmark rates.
Example: the best interest rate brokered by HypoPlus for a 10-year fixed-rate mortgage at the end of December 2024 was 1.15% – at a reference rate of 1.63%.
You can find the latest rates, which are updated daily, in the Comparis mortgage rate overview.
| Fixed-rate mortgage term | Benchmark rate (as at 31 December 2024) | Best interest rate from HypoPlus (as at 31 December 2024) | Potential savings on a mortgage of 750,000 francs |
|---|---|---|---|
| 3 years | 1.26% | 0.83% | 9,675 francs |
| 5 years | 1.44% | 0.94% | 18,750 francs |
| 10 years | 1.63% | 1.15% | 36,000 francs |
| 15 years | 1.81% | 1.35% | 51,750 francs |
Source: Comparis, HypoPlus
The benchmark rates calculated by Comparis are the average rates advertised by around 30 mortgage lenders and can be negotiated. They are updated daily and published in the mortgage rate overview.
3. Falling key interest rates, falling mortgage rates
The Swiss National Bank (SNB) lowered the key interest rate in December 2024 for the fourth time in a row – from 1% to 0.5%.
Due to market expectations of falling key interest rates and the decisions that have actually been made, the mortgage rates have fallen in the fourth quarter for all mortgage models.
SNB with interest rate cuts before the ECB and the Fed
With its rate reduction cycle, the SNB is well ahead of the European Central Bank (ECB) and the US Federal Reserve (Fed), which both reduced their key interest rates by 0.25 percentage points to 3% and 4.25 to 4.50%, respectively.
The interest rate policy depends largely on the development of inflation. While inflation in Switzerland has been well below 1% for months, it has recently risen slightly again in the eurozone and the US – and is above the target of 2%.
Fixed-rate mortgages with a medium term are still cheaper than Saron mortgages
Saron mortgages have been reduced by around 1.25 percentage points due to the fourth interest rate cut in a row. This makes them slightly more expensive than fixed-rate mortgages with a medium term, but slightly cheaper than fixed-rate mortgages with a 10-year term.
Dirk Renkert explains:
Saron mortgages have been significantly reduced with the interest rate increase of 0.5 percentage points. Although the benchmark rates for fixed-rate mortgages have already fallen, but not so strong. Nevertheless, fixed-rate mortgages are listed at a very attractive level. If you are looking for planning security at attractive conditions, fixed-rate mortgages are a good choice. If you can bear the interest rate risk and believe in falling interest rates, Saron mortgages are probably more suitable
4. Which type of mortgage is most popular?
The agreements with the Comparis mortgage partner HypoPlus show an unbroken preference for fixed-rate mortgages with long terms.
The share of long-term fixed-rate mortgages (10 years or longer) increased from about 70 to about 77% in the fourth quarter. In the first and second quarter, this value was even lower.
Mortgages with medium terms (4 to 6 years) lost popularity and fell to around 11%. In the second quarter, their share was still around 30%.
Mortgages with short terms (up to three years, including Saron mortgages) accounted for about 7% of deals, as in the previous quarter. Around 4% of this was attributable to Saron mortgages.
Affordability: people often don't think about their income situation at retirement. If their income is lower than before retirement, the affordability of their mortgage is at risk. This also applies to early retirement. Tip: check whether partial amortization is possible.
Renewal of an expiring fixed-rate mortgage: be sure to observe the contractual notice periods. Start planning early and put together a dossier for lenders. The lead time is about two to three months.
Good to know: with a split into two or more tranches you can increase the flexibility of fixed-rate mortgages. You do not have to renew the entire mortgage, just the tranche that is due. However, division into tranches can weaken your negotiating position and make it more difficult to switch providers.
5. Data sources
HypoPlus, the mortgage partner of Comparis, provides the interest rates for the Comparis Mortgage Barometer. They are based on the benchmark rates of some 30 lenders. The data is updated daily and displayed in the mortgage rate overview.
The next Mortgage Barometer will appear in April 2025.
This article was first published on 05.10.2013
