Buyers in the residential property market faced an ongoing uptrend in prices across most regions of German-speaking Switzerland and Ticino throughout the past year. However, the pace of

growth has notably decelerated due to successive interest rate hikes, as indicated by an analysis of residential property prices conducted by the Swiss Real Estate Institute on behalf of the property portal Newhome, published on Monday.

The analysis, which relies on actual sales prices from the Swiss Real Estate Data Pool, covering around 40% of all transactions in Switzerland, reveals that single-family homes experienced an average price increase of 3.6%, surpassing the general inflation rate of 2.1%. In contrast, flats saw a more modest uptick of 0.4%.

Of the six regions studied, Central Switzerland claimed the title of the most expensive region for detached houses, with an average price of CHF1.64 million ($1.9 million) in 2023, marking a 5.1% increase from the previous year. Zurich secured the second spot with an average price of CHF1.54 million (1.3%).

Eastern Switzerland and Ticino witnessed the most significant price surges at 8.2% and 6.7%, respectively, outpacing Northwestern Switzerland (3.5%). The substantial increases in these regions can be attributed to a catch-up effect and the relatively easier financing environment, given that prices in both areas remain lower compared to other regions.

The combined cantons of Bern and Solothurn experienced a rare decline in prices (-2.1%), with single-family homes having the lowest average selling price of CHF920,000 in this region.

In the flat market, Zurich surpassed Central Switzerland in terms of average prices, rising by 1.8% to CHF1.14 million. Conversely, Central Switzerland saw a decline of 3.6%, bringing the average price to CHF1.08 million. This shift signifies a change from the previous year, where both regions were tied at the top.

With the exception of Bern and Solothurn, where average prices dropped by 8.8%, all other regions observed an increase in flat prices. Bern and Solothurn now claim the title of the most affordable region for flats, with an average price of CHF620,000, replacing Ticino at CHF680,000.

Noteworthy differences among municipalities were observed, with Erlenbach in Canton Zurich leading as the most expensive municipality for detached houses, boasting an average property price of CHF5.16 million, significantly surpassing the second-ranking Hünenberg by CHF1.31 million.