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The Swiss economy has remained resilient amid global challenges, such as high inflation and rising geopolitical tensions. In 2024, the Swiss economy grew by 0.9% adjusted for sport events. Weak foreign trade was offset by above-average growth in private consumption and thus strong domestic demand. Despite the continuing high level of uncertainty, a slight improvement in economic development is expected for 2025. The European Purchasing Managers’ Indexes (PMIs) have recovered from their lows, and in Switzerland the leading indicators also point to slightly higher momentum. In 2025, Swiss GDP, adjusted for sport events, is thus expected to grow by 1.5%.

After the attractiveness of Swiss real estate investments declined significantly in 2022 and 2023 due to the rapid rise in interest rates, the signs improved considerably again in 2024. Low inflation has allowed the Swiss National Bank (SNB) to lower interest rate substantially over the past year, bringing momentum back to the real estate market. Investor demand has risen significantly as the risk premium for real estate investments has recovered. Particularly the rental housing market stays strong as high immigration continues to fuel demand while construction activity remains limited. The commercial real estate segment is adapting to structural shifts and high economic uncertainty, though the rental market remains robust, particularly in central locations, despite these challenges.

The outlook for the Swiss real estate market remains positive as economic indicators are expected to further improve and long-term interest rates are expected to stabilize at lower levels. In the residential market, excess demand should further drive rental growth. Office spaces are accommodating hybrid work models, focusing on prime locations and sustainability. Retail spaces are recovering, driven by improved consumer sentiment and rising retail sales. The logistics segment is benefiting from structural tailwinds such as digitalization and a certain degree of reshoring as global tensions increase. The Swiss hotel sector is expected to grow further in 2025, benefitting from a continuing recovery in tourism from abroad and major events that support city hotels also this year.