| RAMZI CHAMAT | OAKS GROUP SA
he Swiss real estate market is evolving rapidly, driven by major structural and cyclical trends. In a context of persistent housing shortages, demographic shifts, and increasing environmental pressures, the 2025 outlook offers valuable insight into the sector’s new dynamics. OAKS GROUP SA, a committed player in sustainable real estate development in Geneva, closely monitors these changes to deliver projects that align with the evolving needs of the market.
According to the latest UBS Real Estate Focus 2025, published on April 3, 2025, prices of single-family homes in Switzerland are expected to rise by an average of 4% in 2025. In comparison, condominium apartments are forecasted to increase by 3%. This trend is primarily driven by:
The aging of Switzerland’s population is a major issue for the housing market. By 2045, the number of people aged 65 and over will increase by 740,000, according to UBS. Contrary to expectations, this shift does not free up housing, as seniors tend to remain in their current homes. This behavior contributes to the scarcity of properties available for sale, especially in high-demand urban areas like Geneva.
Low tenant mobility has created a growing gap between existing rents and newly offered rents. In Geneva, rents for new leases can be up to twice as high as those paid by tenants who have stayed in place for over a decade. This phenomenon, known as the “moving penalty,” discourages tenants from relocating, freezes the rental market, and worsens the shortage.
While permit applications rose between 2023 and 2024, building permits have not kept pace, slowing down the renewal of the housing stock. UBS anticipates a resumption in housing construction from 2026. However, the vacancy rate for rental units is expected to continue declining in 2025, from 1.6% to 1.4%. A market balance is not expected before 2027.
Since 2024, buying a home has become more attractive than renting due to falling interest rates. Nevertheless, strict mortgage lending requirements are limiting access to ownership, especially for younger households. The proportion of homeowners under 65 declined between 2011 and 2022. Still, the potential return of negative interest rates could continue to support demand for owner-occupied housing, particularly single-family homes.
By 2030, only 50% of heating systems in Switzerland will be considered sustainable according to UBS. Cantons like Fribourg, Basel-Stadt, and Obwalden have higher rates of energy-efficient renovations, while Geneva, Vaud, and Neuchâtel lag behind. Energy renovations tend to be more cost-effective in single-family homes, while posing financial and technical challenges in multi-unit buildings, unless full renovation and lease terminations are involved.
The widespread adoption of remote work continues to impact the office space market. The vacancy rate has risen from 4% in 2019 to 5% today, according to UBS. This trend is prompting companies to reduce their leased office space, resulting in stagnant rents in this segment. These changes may permanently transform how businesses use office spaces.
The Swiss real estate market, particularly in Geneva, faces structural tensions related to demographics, housing shortages, and sustainability demands. In this complex environment, OAKS GROUP SA is committed to developing sustainable, high-quality real estate projects tailored to the needs of today’s and tomorrow’s households. Amid steadily rising prices, local expertise and long-term vision are key to securing real estate investments.
1. Why are single-family home prices increasing in 2025?
Due to housing shortages, low interest rates, and limited residential mobility, prices are being sustained.
2. Does remote work affect the residential market?
Indirectly, yes. It influences demand in suburban areas while reducing pressure on office space.
3. Is real estate investment still attractive in Geneva?
Absolutely. Despite challenges, land scarcity and market stability make Geneva appealing for investors.
4. Which cantons are leading in sustainable heating systems?
Fribourg, Basel-Stadt, and Obwalden are ahead, according to UBS.
5. What is OAKS GROUP SA’s position in this context?
OAKS GROUP SA develops projects aligned with environmental and demographic challenges, focusing on innovation and quality.
