Rents unlikely to rise as Swiss mortgage ref rate stays at 1,25%

With the rising cost of living being a constant worry for many internationals living in Switzerland, residents will be relieved to hear that rent prices are unlikely to change in the near term. 

Swiss mortgage reference rates remain at 1,25 percent

The Swiss government has announced that the quarterly-published mortgage reference interest rate (Hypothekarischer Referenzzinssatz) will remain at 1,25 percent from June 2, 2026. For anyone renting in Switzerland, this means rent is unlikely to rise anytime soon.

The mortgage reference rate, which is closely tied to the cost of renting, reached a historic low in September 2025. The Federal Office for Housing (BWO) publishes an update each quarter and, as of March 31, 2026, the average Swiss mortgage rate decreased from 1,32 percent to 1,31 percent. This is then rounded to the nearest quarter of a percentage point, meaning that the average mortgage reference interest rate will remain stable at 1,25 percent. 

While the lack of movement in the mortgage reference interest rate means that landlords cannot increase rent based on interest rate changes, there are some cases where rent can be increased. For example, landlords can adjust rent based on inflation and maintenance costs. 

It may also be worth checking your rental agreement (Mietvertrag) to see if it’s based on the current mortgage rate of 1,25 percent. If your contract is based on a previous rate of 1,5 percent or more, then you may be able to request a rent reduction. Organisations such as the Tenants’ Association (Mieterverband) in German-speaking Switzerland provide in-depth, local advice on renting.

Will rent prices increase in Switzerland in 2027?

Most renters can enjoy keeping a few extra rappen in the bank until at least September 1, 2026, when the government will release the next update on the reference interest rate. According to 20 Minuten, the rate should “remain at its current level throughout the year” based on UBS analysis. 

However, this is assuming that the ongoing war in the Middle East will end soon and that trade and energy supplies will return to normal. Next year could get more expensive, as banking experts predict that the reference rate could rise in 2027 if the Swiss National Bank is forced to raise interest rates.