Switzerland is getting closer together: Due to housing shortages, more and more people are forced to live in shared flats

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Until recently, the Swiss wanted one thing above all else: to be for themselves. The number of one- or two-person households has been increasing for years. However, the crisis in the housing market left its mark. More and more tenants can no longer afford their own apartment.

The number of small households increased again last year. However, the growth curve has been pointing sharply downwards since 2021, simultaneously experiencing a strong increase in population. On the other hand, the number of people in newly formed households consisting of three or more people also increased steadily during this period: 29,000 new large households were established in 2022. This is 7,466 more than the previous year.

Housing demand is changing

Do these numbers represent a trend reversal? Real estate consultant Wüest Partner contextualizes household data from the Federal Statistical Office in its annual property monitoring. “On closer examination, it becomes clear that the household structure is beginning to change, and with it the demand for housing,” says Robert Weinert (44), Head of Research at Wüest Partner.

Everything indicates that the Swiss population is increasingly forced to live under the same roof with other people, rather than alone. No wonder life is becoming more and more expensive. In addition to rents, health insurance premiums, food, electricity and heating expenses are also increasing. This especially affects the younger generation. Young adults are less likely to buy their own apartment. “That’s why they move out of their parents’ house later or set up a shared apartment more often,” says Weinert. This development is especially evident in cities such as Zurich, Lausanne, Winterthur, Lucerne and Zug.

“In contrast, the increasing proportion of the elderly population is becoming the most important reason for the increasing number of small households,” says the real estate expert.

Individualization and community

Switzerland is drawing closer together again. But not because society is moving away from individualism and focusing more on community spirit. “The figures make it clearer that the housing shortage and reduced new construction activity are having a significant impact on the demand behavior of Swiss households.”

“The choice of living arrangement may not reflect a person’s true wishes,” says Weinert. The tenants have made a virtue out of necessity. Acute housing shortages combined with rising rents are forcing them to live with other people rather than living alone. But trends from 2017 to 2020 prove that your dream home will be different. At that time, while rents were falling and choices were more diverse, a significant proportion of Swiss people lived in smaller households.

Now famine has caused people to narrow down their living spaces. From an environmental perspective, this is good news. Larger households have lower CO₂ emissions. The development is also encouraging from an economic perspective. Because limited living space is used more efficiently. “Time will tell what impact this will ultimately have on society,” says Weinert.

Rents are increasing so much

Tenants have no choice right now anyway. The market has dried up. The number of advertised rental apartments continued to decrease in the second quarter of 2023. At the same time, new construction activity is decreasing. Approvals in the second quarter of 2023 remain below the average of the previous decade. And demand is still high. The permanent resident population is expected to increase by around 1.6 percent in 2023.

As a result, rents for the few properties available are rising sharply. In its own index for asking rent, Wüest Partner calculated the rental price evolution of a typical advertised apartment without additional costs. The standard apartment is 85 square meters, 3.5 rooms, in a slightly above average location, is 35 years old and costs 1,620 francs. The index shows that the rent for such an apartment has already increased by 3.5 percent in the second quarter of 2023 compared to the previous year. In 2024, this rate is likely to be another 4.8 percent.

All these are indicators that household size will continue to increase in the near future. For many Swiss, the possibility of owning their own apartment is now becoming a distant possibility.

Source :Blick