Opinion poll. Swiss mortgage borrowers confident despite rising interest rates.

When it comes to financing home construction, 10-year mortgages remain the most popular. (archive image)


The latest interest rate hike by the Swiss National Bank has left its mark on the mortgage market. Despite rising interest rates, there was a boom in short-term Saron mortgages. The most popular mortgage remains the one with a 10-year term.

While fixed-rate mortgages have returned to levels last seen in mid-2011 following the recent rise in interest rates, interest rates on Saron mortgages have barely changed. They currently cost 0.97 percent, as the comparison service Comparis announced on Thursday.

Bad economic news has weighed on the financial markets for months. Nevertheless, confidence seems to prevail among many mortgage borrowers. They trusted the SNB to bring inflation under control without severe turbulence.

This is reflected in the nature of the degrees. Instead of quickly tying up rising interest rates with a fixed-rate mortgage as long as they are historically cheap, Comparis has noticed a significantly increased demand for Saron mortgages since the beginning of the year.

Compared to the previous year, their share has almost tripled to around a third of all deals. Anyone who borrows in Saron mortgages, however, risks being caught flat-footed if interest rates continue to rise.

The reference interest rate of the Swiss National Bank (SNB) could once again reach the same dimensions as in the last major crisis on the mortgage market in the early 1990s. At that time, the reference interest rate climbed up to 7 percent.

The majority of customers still prefer fixed-rate mortgages, as Comparis continues. They appreciated the planning security. Nearly half of the deals are in 10-year mortgages, although demand has dropped somewhat. Your reference rate is currently 3.2 percent.



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