August 2026 average rates on new mortgages (SNB), 5 and 10-year trend curves since 2020, SNB impact and analysis: should you borrow now or wait?
In Switzerland a mortgage is either fixed for a set term or linked to SARON, the Swiss money market rate. In August 2026 the Swiss National Bank recorded average rates on new business of 1.19% for a SARON mortgage, 1.51% for a 2-year fix, 1.76% for a 5-year fix, 2.03% for a 10-year fix and 2.34% for a 15-year fix; the traditional variable mortgage stood at 2.79%. The SNB policy rate has been 0% since 20 June 2025. On CHF 800,000, interest alone costs about CHF 1,170 a month at 1.76% and CHF 790 at 1.19%, before the mandatory amortisation of the second mortgage. The table below gives these averages, with their source and the month of the data.
10-year fixed
2.03%
August 2026, SNB
SARON mortgage
1.19%
August 2026, SNB
SNB key rate
0%
Since June 20, 2025
5-year fixed
1.76%
August 2026, SNB
Average rates on new business by product (Swiss National Bank, data.snb.ch, cube zikrepro, August 2026). Monthly payment and cost shown for reference over 25 years.
| Type | Average Rate |
|---|---|
SARON mortgage | 1.19 % |
2-year fixed | 1.51 % |
5-year fixed | 1.76 % |
10-year fixed | 2.03 % |
15-year fixed | 2.34 % |
Variable mortgage | 2.79 % |
Half-yearly averages of 5 and 10-year fixed rates on new mortgages (SNB); H2 2026 covers July and August. The dashed line is the SNB policy rate at the end of each period.
Decline zone since H1 2023 peak. The SNB led the way by cutting rates before the ECB, triggering a rapid easing of mortgage rates.
Each Swiss National Bank decision influences mortgage rates with a 1 to 3 month lag. The SNB was a pioneer in cutting rates in 2024.
The SNB keeps its policy rate at -0.75%. New 10-year fixed mortgages cost 1.28% on average in the first half (SNB). The Swiss property market stays dynamic despite Covid, supported by ultra-low rates.
SNB rate still at -0.75%. The 5-year fix bottoms at 1.06% in August 2021. The property market surges and housing shortages intensify in urban centres.
The SNB raises its rate to -0.25% in June 2022, exits negative rates in September (0.50%) and reaches 1.00% in December. The 10-year fix peaks at 3.29% in September 2022. The shock is brutal but the property market holds thanks to structural shortages.
The SNB policy rate reaches 1.75% in June 2023. The 5-year fix peaks at 3.04% in March, then fixed rates ease in the second half (2.77% on average for 10 years) while SARON mortgages climb to 2.74% in September. Prices hold, supported by immigration and a lack of new construction.
The SNB starts cutting in March 2024, ahead of the ECB and the Fed: four cuts bring its rate from 1.75% to 0.50% in December 2024. The 10-year fix eases to 1.90% on average in the second half.
The SNB cuts to 0.25% in March and to 0% in June 2025. SARON mortgages fall to 1.14% in the second half, 10-year fixes stay near 1.9%. Competition between UBS, Raiffeisen and cantonal banks intensifies.
The policy rate stays at 0%. Fixed mortgages edge up with long-term yields: in August 2026, 1.76% for 5 years and 2.03% for 10 years, against 1.51% and 1.87% a year earlier; SARON mortgages stay around 1.2% (SNB).
For a household able to put CHF 4,950 a month towards repayments, here is the amount it can borrow by rate, repaid over 25 years (indicative, excluding the 5% affordability rule).
2.79%
CHF 1,068,281
2.34%
CHF 1,123,464
+CHF 55,183
2.03%
CHF 1,163,839
+CHF 95,558
1.76%
CHF 1,200,676
+CHF 132,395
1.19%
CHF 1,283,928
+CHF 215,647
Analysis based on SNB policy, Swiss inflation and Swiss property market fundamentals.
Lowest Rates in Europe
In August 2026 new SARON mortgages averaged 1.19% and 10-year fixed mortgages 2.03% (SNB), far below euro area or US rates. For international buyers, Switzerland offers some of the cheapest mortgage financing in the developed world, driven by the SNB's 0% policy rate and the safe-haven status of the franc.
Safe Haven Currency
The Swiss franc has appreciated against the euro and the dollar over the long term: on October 2, 2026 the ECB reference rate was €1 = CHF 0.9279. For an international buyer, Swiss property combines real estate value with exposure to one of the world's most stable currencies, with the risk that the franc could weaken.
Ultra-Stable Property Market
Switzerland has not experienced a property crash in over 30 years. Strict macroprudential regulation, the Lex Weber cap on second homes, and conservative bank lending (Tragbarkeit at 5% imputed rate) prevent bubble formation. Swiss real estate is the definition of 'boring but safe' – exactly what international capital seeks.
World-Class Fundamentals
Highest GDP per capita in Europe, unemployment below 2.5%, AAA-rated sovereign credit, and a political system renowned for stability. Property values in Switzerland are underpinned by real economic wealth, not speculation. For global investors comparing jurisdictions, few markets offer this combination of low rates and strong fundamentals.
Tax-Deductible Mortgage Interest
Swiss residents can deduct mortgage interest from taxable income under the Eigenmietwert system. This is why many Swiss homeowners deliberately maintain a high LTV ratio rather than paying down their mortgage. For expats on high Swiss salaries, this tax optimisation can save thousands of francs annually, effectively reducing the real cost of homeownership.
Lex Koller Restrictions
Non-residents can only purchase property in designated tourist zones such as Verbier, Crans-Montana, or Zermatt, with a national quota of 1,500 units per year. Residents with B or C permits are exempt for primary residences. This is the single biggest barrier for international buyers – understanding your permit status and its implications is essential before any property search.
Extreme Price Levels
Geneva averages CHF 13,000/m², Zurich CHF 12,000/m², and even smaller cities like Lausanne or Basel exceed CHF 8,000/m². With a mandatory 20% deposit, the entry ticket for a standard apartment exceeds CHF 200,000 in cash. Compared to other safe-haven markets like Singapore or Sydney, Switzerland is at the very top of the global price scale.
Mandatory Amortization
Swiss banks require borrowers to pay down the second mortgage to 2/3 LTV within 15 years. This mandatory amortization means actual monthly costs are significantly higher than the headline rate suggests. International buyers used to interest-only mortgages (common in the UK, US, or Singapore) need to factor this into their affordability calculations.
Imputed Rental Value Tax
Owner-occupiers in Switzerland are taxed on the theoretical rental value of their property (Eigenmietwert), even if they live in it, while mortgage interest is deductible. Voters approved the abolition of this imputed rental value for primary residences on September 28, 2025; the date it takes effect has yet to be set.
For expats buying a primary residence: conditions are excellent. Rates from 1.19% (SARON) to 2.03% (10-year fixed) in August 2026 are among the lowest in the developed world, and B/C permit holders face no Lex Koller restrictions. The SARON variable rate offers the cheapest entry point, with the flexibility to lock in a fixed rate later. Ensure you pass the 5% Tragbarkeit stress test.
For non-resident investors: opportunities are limited to tourist zones under Lex Koller, with strict quotas. Net rental yields are low (2.5-3.5%) and the imputed rental value tax adds to costs. However, the CHF currency appreciation and ultra-stable market make Swiss property attractive as a long-term wealth preservation vehicle for global portfolios.
Restricted by Lex Koller (LFAIE). Residents with B (residence) or C (permanent) permits can buy unrestricted for primary use. Non-residents are limited to designated tourist zones only (Verbier, Crans-Montana, Zermatt, etc.), with a national quota of 1,500 units per year and a 200m² cap. Understanding your permit status is the essential first step.
In August 2026 the SNB recorded average rates on new mortgages of 1.19% for SARON-linked loans, 1.76% for a 5-year fix and 2.03% for a 10-year fix. Compare with France (3.27% over 20 years, August 2026), a UK 5-year fix at 75% LTV (4.78%, August 2026) or the US 30-year fixed (7.28%, October 1, 2026). Whatever the rate, lenders apply an affordability test at a theoretical five percent, so the imputed costs of the property must stay below a third of gross income.
Switzerland offers some of the lowest mortgage rates among developed nations: 1.19% to 2.03% for new SARON and fixed mortgages in August 2026 (SNB), against 3.27% in France, 4.78% for a UK 5-year fix and 7.28% for a US 30-year fixed. The structural advantage comes from the SNB's 0% policy rate, the safe-haven status of the CHF and high domestic savings. Even at the 2022-2023 peak, the average 10-year fix stayed below 3.3%.
SARON (Swiss Average Rate Overnight) replaced LIBOR in 2022 as the reference rate for variable Swiss mortgages. It tracks overnight interbank lending in CHF and resets quarterly. Banks add their margin on top: new SARON mortgages averaged 1.19% in August 2026 (SNB). The rate moves directly with SNB policy decisions, typically with a 1-2 week lag.
Minimum 20% of the purchase price, with at least 10% from non-pension savings (cash, gifts, inheritance). The remaining 10% can come from Pillar 2 (pension fund) or Pillar 3a. For context, the average Swiss apartment costs CHF 800,000-1,200,000, meaning a deposit of CHF 160,000-240,000. This is the highest deposit requirement among major markets.
A uniquely Swiss system: owner-occupiers are taxed on 60-70% of the theoretical market rent of their property as if it were income. This 'Eigenmietwert' is added to taxable income. In return, mortgage interest and maintenance costs are deductible. This is why Swiss homeowners keep high mortgages – the interest deduction offsets the imputed rental tax. Voters approved its abolition for primary residences on September 28, 2025, together with the end of the interest deduction; the date it takes effect has yet to be set.
Yes. Pillar 3a: full withdrawal permitted for primary residence, taxed at a reduced capital withdrawal rate. Pillar 2 (pension fund): up to 50% of the mandatory portion can be withdrawn (WEF/EPL), or the full amount can be pledged without withdrawal. Tax implications vary significantly by canton – Zug and Schwyz are most favourable, Geneva and Vaud least. Withdrawals must be repaid if the property is sold.
Banks use a 5% imputed interest rate (not the actual rate) plus 1% annual maintenance costs plus mandatory amortization. This total must be below 33% of gross household income. For a CHF 1M property with 20% deposit, you need approximately CHF 180,000 gross annual income. This is the most conservative stress test in Europe and is the effective barrier to Swiss homeownership.
Switzerland offers the lowest mortgage rates in the developed world in 2026, with new SARON-linked mortgages at 1.19% and 10-year fixed rates at 2.03% on average in August (SNB). For international buyers and expats, the Swiss property market combines ultra-low financing costs with one of the most stable real estate markets globally. However, the system is uniquely complex: Lex Koller foreign ownership restrictions, the Tragbarkeit affordability stress test, mandatory amortization, and the imputed rental value tax create barriers that require careful navigation. This guide covers everything an international buyer needs to know.
Swiss mortgage rates have been structurally lower than most developed markets for decades. The reasons are fundamental: the Swiss franc's safe-haven status keeps inflation low, allowing the SNB to bring its policy rate down to 0% in June 2025 after six cuts from 1.75% starting in March 2024. Domestic savings are high, creating abundant liquidity in the mortgage market. Compare globally: new Swiss 10-year fixes averaged 2.03% in August 2026, against 3.27% over 20 years in France, 4.78% for a UK 5-year fix and 7.28% for a US 30-year fixed. For international investors, this rate differential is the single most compelling reason to consider Swiss property.
The Lex Koller (LFAIE) is the federal law governing foreign property ownership in Switzerland. Non-residents without a Swiss work permit can only purchase in designated tourist zones – approximately 200 communes including Verbier, Crans-Montana, Zermatt, Gstaad, and St. Moritz. A national quota of 1,500 units per year applies, with a maximum habitable surface of 200m². Residents holding B (residence) or C (permanent) permits are fully exempt for primary residence purchases. L permit holders (short-term) face restrictions. The law does not apply to commercial property or to Swiss/EU nationals with permanent residence. For non-resident international buyers, Lex Koller effectively limits the market to luxury ski and resort properties, typically starting at CHF 1.5 million.
International buyers face the same choice as Swiss residents: SARON variable (1.19% on average in August 2026) or fixed-rate mortgage (2.03% for 10 years, SNB). SARON tracks the Swiss overnight interbank rate and resets quarterly, with a bank margin on top. It offers the lowest entry cost but exposes you to rate changes. Fixed-rate mortgages (Festhypothek) lock your rate for 2 to 15 years. For expats on fixed-term contracts, the SARON offers flexibility; for permanent residents planning to stay long-term, the fixed rate provides certainty for a modest premium. A blended strategy (50% SARON + 50% fixed) is popular among Swiss financial advisors.
Despite having the lowest rates in Europe, Switzerland has some of the highest barriers to homeownership. The Tragbarkeit stress test uses a 5% imputed rate (not the actual rate) plus 1% maintenance plus amortization – this total must be below 33% of gross income. For a CHF 1 million apartment with 20% deposit, you need approximately CHF 180,000 in annual gross income. The 20% deposit requirement, with at least 10% from non-pension savings, means CHF 200,000+ in cash for a standard urban apartment. Geneva averages CHF 13,000/m², Zurich CHF 12,000/m², even Bern exceeds CHF 7,000/m². The result: Switzerland has one of the lowest homeownership rates in Europe (36% vs 65% EU average), despite having the continent's cheapest mortgages. For international buyers, passing the Tragbarkeit test is typically the make-or-break factor.
Expats with B or C permits can access Swiss mortgages on standard terms, but banks scrutinize foreign applicants more carefully. Key requirements: stable employment with a Swiss company (minimum 6-12 months), income paid in CHF, and clean Swiss credit history (check via ZEK). Some banks require a higher deposit (25-30%) for non-Swiss nationals. Pillar 2 and 3a pension funds can be used for the deposit after contributing for at least one year. International banks with Swiss operations (UBS, HSBC, Credit Suisse/UBS) often have dedicated expat mortgage teams familiar with complex income situations (split contracts, equity compensation, offshore income). Mortgage brokers like MoneyPark or Comparis can access rates from 100+ lenders and are particularly valuable for expats navigating the system for the first time. Budget 3-5% of the purchase price for acquisition costs (transfer tax, notary, land registry).
* Rates shown are SNB averages for new business in August 2026 and may vary by institution, canton and borrower profile. SNB data is public and verifiable at snb.ch. This content is for informational purposes and does not constitute personalised financial or legal advice.