In any other country, Philip Skiba, a highly paid financial analyst, would not hesitate to buy a house. But in the town where he lives on the outskirts of Zurich, even ugly houses, as he describes them, cost millions.
Last year, a simple beige stucco house went up for sale in her neighborhood. The price: 7.5 million Swiss francs, or about $8.3 million.
“The first thing I thought was that this is ridiculous, it’s almost an insult,” said Skiba, 41, who shares a rented apartment with his girlfriend. (Her income from him is 6,000 francs, or $6,600, per month.) When the house sold several weeks later, it reinforced for him the reality of owning a home in Switzerland.
“It’s beyond luxury,” Skiba said. “Two kids, a house, a garden, two cars… I don’t know anyone who has that.”
Switzerland’s 9 million residents are among the richest people on the planet—and most of them rent. Increasingly, even urban professionals find themselves excluded from the real estate market. The average price of a studio apartment in Zurich is $1.1 million, reports research company Wüest Partner.
At a time when young people in places like New York and London see no way to buy a home, Switzerland offers the world a glimpse of a post-ownership society. About 36 percent of Swiss own their homes or apartments, the lowest rate in the West and well below the average of 70 percent in the European Union and 67 percent in the United States.
While many young Swiss say they see positives in renting for life — mainly avoiding the hassles of homeownership — they also admit to feeling resentful about not having another option.
“I think most people in Switzerland still dream of a single-family house,” said Andreas Weber, 36. “It’s just not possible anymore.”
Weber is the managing director of Corefinanz, a mortgage agency, but he himself rents and lives in an apartment half an hour by train from the center of Zurich. The average age of a first-time homebuyer in Switzerland is 48, 15 years older than in neighboring France.
In Switzerland, where 70 percent of the land is mountainous and expensive real estate on limited buildable land has been the reality for generations, renting for life is not considered a personal failure. “I know a lot of people who would never want to buy,” said Alice Hollenstein, a psychologist specializing in urban issues. “They just don’t value homeownership.”
Any preference for renting here runs up against a stark financial reality: national surveys show that in recent decades, Swiss homeowners have been better off, at least in terms of wealth. The average net worth of a Swiss homeowner in their 30s is six times that of someone of the same age who rents. And the wealth gap only increases with age, shows a study by Ursina Kuhn of the Swiss Foundation for Social Science Research in Lausanne.
The bottom line is that to become a homeowner, “you need wealth to get more wealth,” as Kuhn said.
Martin Hoesli, a professor at the University of Geneva, said that although the math favors long-term home ownership, many Swiss cannot afford the down payment, which by law is a minimum of 20 percent of the purchase price. The minimum down payment for an average-priced home in Switzerland, currently $1.4 million, is $336,000.
When Hollenstein, 41, and her partner had their first child four years ago, they wanted a more permanent home. They found a 140-square-meter house east of Zurich for 2.1 million francs ($2.3 million).
When he told his friends, he said, “Their reaction wasn’t, ‘Wow, cool!’ but rather, ‘Really?’”
By: THOMAS FULLER
BBC-NEWS-SRC: http://www.nytsyn.com/subscribed/stories/6982699, IMPORTING DATE: 2023-11-13 19:10:07
#Switzerland #rent #housing #life