What's the extent of foreigners' responsibility in Switzerland's housing crisis?
In a new analysis by Wuest Partner consultancy group, the relationship between immigration and housing scarcity in Switzerland has been shed more light on. The study reveals that while immigration does contribute to housing demand, it is not the primary cause of housing shortages or price hikes.
The Swiss economy’s prosperity encourages both native and foreign residents to seek housing, intensifying demand beyond what immigration alone would cause. Immigrants, including immigrants, refugees, and asylum seekers, require accommodation when settling in Switzerland, adding to the demand for accommodation.
However, experts emphasize that migration itself is not the primary cause of housing shortages or price hikes. Instead, structural factors such as limited land for construction, high construction costs, and regulatory constraints also play major roles. The shortage of available land due to geographic and environmental restrictions in Switzerland limits new housing construction, contributing significantly to scarcity alongside immigration pressures.
The study confirms that immigration does stimulate higher demand for rental housing and, consequently, higher rents. The living space per person is significantly lower for foreigners compared to Swiss households, with foreigners typically occupying smaller dwellings, with an average of 1.4 rooms per person compared to 1.9 for Swiss households.
Immigrants mostly prefer to settle in urban areas, with only about a third considering moving to the countryside. They prioritize proximity to the workplace, accessibility by car or public transport, and the presence of schools in the neighborhood.
The number of immigrants, primarily from the EU, has been growing steadily. Swiss households place more emphasis on sustainability in their dwellings, such as ecological building materials and renewable energy.
It is essential to note that immigrants cannot be blamed for these factors. The housing shortage in Switzerland has been worsening, and a 1-percent population growth leads to a 1.37-percent increase in rents, according to the study. However, the study notes that population growth influences prices, but it is not the primary driver.
In the rental market, the benchmark mortgage rate, inflation, and vacancy rate have the greatest influence, with immigration playing a significant role in price dynamics but part of a broader set of economic factors. The report does not confirm that immigrants are solely responsible for a tight housing market and high rents in Switzerland.
In conclusion, immigration adds to demand, but Switzerland’s housing scarcity is driven chiefly by economic factors, land constraints, and construction costs, with immigrants’ accommodation needs reflecting these broader market forces rather than uniquely causing scarcity or inflation. The study provides valuable insights into the complex relationship between immigration and housing scarcity in Switzerland, emphasizing the need for a comprehensive approach to address this issue.
- Investing in real-estate becomes more appealing as the demand for housing increases due to immigration, escalating rental prices in Switzerland.
- Beyond immigration, factors like limited land for construction, high construction costs, and regulatory constraints significantly contribute to the scarcity of housing in Switzerland, making it a challenging field for finance and investing in the country's real-estate market.
