SNB Keeps Key Interest Rate at Zero: What This Means for Your Real Estate Project

Imagine opening your mortgage simulation and seeing a number that changes everything: key interest rate at zero. Neither positive nor negative for most deposits, with some nuances for banks and large accounts. This decision by the Swiss National Bank (SNB) directly affects your choices for buying, selling, or investing in real estate. But what does this rate really mean, and how does it translate on the ground? Let’s break it down.

What is the Key Interest Rate at Zero?

The key interest rate is the SNB’s main tool for steering monetary policy. It directly influences:

  • Short-term rates (like SARON, −0.04% on 02.10.2025)
  • Credit conditions for individuals and businesses
  • The attractiveness of saving vs. investing

At 0% since June 20, 2025, it indicates that the SNB wants to support the economy without creating a financial shock. But note: for sight deposits exceeding a certain threshold, the applied rate is −0.25%, which nuances the idea of “absolute zero.” (SNB)

Why Does the SNB Maintain This Rate?

  1. Low inflation: price stability allows a neutral stance.
  2. Flexibility on the Swiss franc:
  3. the SNB can intervene in the foreign exchange market instead of adjusting the main rate.

Concrete Example: Long-term rates (10-year federal bonds at 0.244%) remain low, but bank margins still influence fixed mortgage rates → what you see on banking websites or ads.

Story: Marc and His House in Chexbres

Marc had been looking for a house for 18 months. In spring 2025, he hesitated: wait for rates to drop or buy now? When the SNB set its key interest rate to 0%, he recalculated: a 10-year fixed mortgage became attractive, and negative SARON for some banks allowed more flexible financing. Marc accelerated his search, found a beautiful house, and signed a few days ago at a notary in Lavaux: stability and manageable monthly payments.

Impacts of the Zero Key Interest Rate on Swiss Real Estate

Here’s what changes concretely:

  1. Short-term mortgage rates: possible decrease for variable/indexed formulas.
  2. Fixed rates: remain attractive for short/medium terms; caution for long maturities.
  3. Purchasing power: slightly improved, some acquisitions become feasible.
  4. Rental investment: returns influenced by compressed bank margins and demand.
  5. Banks cautious: stricter lending criteria despite a low key rate.

7 Practical Recommendations

  1. Buyers: simulate fixed vs. variable rates; let your Excel sheet speak.
  2. Sellers: highlight the attractiveness of financing.
  3. Investors: recalculate returns and diversify risks.
  4. Homeowners: consider refinancing if current rates are high (especially since recent votes).
  5. Agents: present multiple scenarios to your clients.
  6. Banks/Advisors: full transparency on costs and conditions.
  7. Everyone: maintain a safety fund for unforeseen events.

FAQ: Key Interest Rate at Zero

Q1: Do mortgages become free?
No. Banks add a commercial margin; effective rates remain positive.

Q2: Should I refinance?
Compare total cost and penalties. Partial renegotiation may sometimes be optimal.

Q3: Will rents increase?
Not automatically. Local supply and demand remain decisive.

Q4: Will the real estate market explode?
Not necessarily. The key interest rate influences, but other factors matter too.

Question for You

And you? If you had to buy or refinance today, would you prefer a fixed or indexed mortgage, and why?

Checklist for Your Real Estate Project

  • Tax advice for investment
  • Forecast maintenance costs
  • Considered fixed/variable mix
  • Security fund established
  • Negotiation of banking conditions
  • Tax advice for investment
  • Forecast of maintenance costs

Possible SNB scenarios:

  1. Prolonged 0% → supports demand, keeps short-term rates low

  2. Drop to −0.25% → stimulates buying but pressures bank margins
  3. Increase if inflation rises → higher financing costs, pressure on prices

Conclusion

  1. The SNB set the key interest rate at zero on June 20, 2025.
  2. Direct impact on short-term rates and some mortgages.
  3. Effective rates remain positive for individuals.
  4. Buyers and investors need to simulate and plan.
  5. Brymmo can help translate this context into a personalized strategy. Discover how your real estate project is affected by the zero key interest rate. Contact Brymmo for a tailored simulation and secure your investment.

Find out how your real estate project is impacted by the zero interest rate. Contact
Brymmo for a personalized simulation and secure your investment.

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