UBS has reported a bubble trend in the real estate market. Should you sell your home now and can you still buy?
In parts of the Zurich region and in central Switzerland, UBS is detecting the beginning of a temporary real estate bubble for residential property. The Swiss Real Estate Bubble Index has climbed to 2.05 points and is thus on the cusp of a bubble. (See the publication UBS Swiss Real Estate Bubble Index 3Q. 2020 and the New Zürich Newspaper of 6/11/2020). What does this mean for sellers and buyers of residential property? Here are three answers from Gerhard E. Walde:
Should owners of residential property and prospective buyers be worried now?
No, because according to the UBS Real Estate Bubble Index forecast, home valuations will fall again by 2021 as the economy recovers. The increase is temporary.
What advice does Walde & Partner have for property owners who are considering selling in the medium term?
Prices have risen continuously over the last twenty years with short interruptions, with the various price ranges developing differently. The market conditions for achieving an optimal price are certainly very good at the moment. The cases in which it is worth selling as quickly as possible and in which it is better to wait a little longer depend on many factors, including personal ones. We will be happy to support you in making a decision and recommend that you talk to us at an early stage.
What advice does Walde & Partner have for prospective buyers?
All times are right for the acquisition of residential property. Today as well as tomorrow and the day after tomorrow. That was true of yesterday, too. There are hardly any homeowners who in retrospect regret buying residential property, even if the price was considered “high” at the time of purchase. On the other hand, prospective buyers who keep hesitating and are constantly speculating on falling property prices generally regret not having bought in retrospect. That is why right now, we still recommend that those who have found their “dream property” can – if the funds are secured – buy with a clear conscience, even at today’s high asking prices. This is because a steep price correction is not to be expected in the near future.
Do you have any further questions about the real estate market or about buying and selling real estate? Our experts will be happy to answer them for you. Call us +41 44 396 60 60, contact us info@walde.ch or simply send us a contact request using the form below.