Switzerland Interest Rates & Opportunities for Property Investors

Switzerland Interest Rates & Opportunities for Property Investors

The Swiss National Bank recently cut its interest rates to zero, reducing it by 0.25% as it teeters on the edge of negative rates. The inherent strength of its currency is for once acting as a negative factor to its economy, as investors have begun buying up the Swiss Franc with Trump’s tariffs and world-wide instability coming to the forefront of people’s mindsets. 

This has presented an opening and great opportunity to both Swiss and foreign property investors alike, as low interest rates mean very low fixed and variable mortgage offers. There has not been a better time to purchase a property in the Swiss Alps for some while now. It is important to note that Swiss banks do not lend across borders. You can only borrow on a property in Switzerland and not anywhere else in the world.



Current mortgage rates
Interest rates in Switzerland have always been some of the lowest in Europe, however even in the last 18 months they’ve seen quite a significant drop. At the start of 2024 rates for a 10-year fixed mortgage were just over 2.26%. Now you are looking at 1.27% for the same deal. You can get 15 years for only 1.64%, while variable rates are currently only 0.81%. With negative rates on the horizon, these could drop even further still. You can see a full breakdown below, which were correct as of 23rd June 2025: 
 
This obviously represents a huge opportunity to both Swiss and foreign buyers alike and will translate to substantial savings when borrowing on a property in Switzerland. It will make previously unaffordable properties attainable and turn the dream of buying an Alpine property into a reality.

If you had borrowed CHF 1m in January 2024 on a 10-year fixed rate, you would have initially been paying CHF 22,600 in annual interest. Now that figure would be just CHF 12,700. Over 10 years, that amounts to quite a difference in your overall outlay. 

Alternatively, you could take out a variable (SARON) mortgage with the rates currently so low. Some clients even choose to split their mortgage into half fixed and half SARON. It’s always best to speak to a local mortgage expert to determine which route would work best for you. We have banking contacts throughout the Swiss Alps and we’d be happy to put you in touch with them.



An opportunity for buyers
For Swiss buyers this all makes buying a second home in the Alps more enticing, as banks will pay nothing if your savings are sitting in an account. It’s best to utilise these mortgage rates and then earn a decent annual rental return on a holiday property. 

Rental returns should interest buyers from Switzerland and all over the world, as you can expect annual returns of between 2% - 5%, depending on the property and how often you use it yourself. Some new developments are even offering annual guaranteed returns of up to 5%. A huge influx of international visitors, particularly from the USA are fuelling this drive in rental incomes. The region has also seen a large increase in the number of summer visitors, as the Alps become more of a year-round destination and not just for skiers.



Property developers have noticed this trend and are already looking to capitalize on the increase in annual visitors by creating developments with built-in rental and management services. Prestigious hotel groups along with local companies are building both large hotel-style residences as well as smaller chalet-style apartment blocks. All are professionally managed for you and provide a yearly income, making the whole process very simple from start to finish. We have a lot of these types of developments currently in the Valais, so check out these options in Saas Fee, Grimentz and Les Collons if it’s of interest.

Property prices are also on the up which, combined with the strength of the Swiss Franc, means your investment is a very safe one. Market data shows property prices in the Alps increased by as much as 5% in the last few years, a significant increase on the 10-year average. These levels are expected to continue and maybe even improve moving ahead, as more and more investors see the potential in Alpine real estate. This has been particularly noticeable in the high-altitude resorts, where snow-surety is becoming the most important factor in finding a place in the mountains.



Why buy in Switzerland? 
There are also a significant number of incentives already as to why one would buy in the Swiss Alps. We have covered them many times before, so great skiing, incredible scenery, a world-famous culinary scene, solid infrastructure, cheap running costs, very low-crime rate and a very safe place to invest are just some of the main reasons you should consider buying here. Combine that with some historically low borrowing rates and you’d be hard pressed to look elsewhere.