Mortgage rates continued to fall after the Swiss National Bank (SNB) announced it would lower its key rate to 0.5%, according to Moneyland. However, the downside potential is limited.
Interest rates for two-year fixed-rate mortgages now stand at just 1.3%, their lowest level this year, the comparison portal Moneyland.ch said in its periodic statement on Wednesday. Ten-year fixed-rate mortgages currently average 1.56% and five-year mortgages average 1.38%, barely above their annual low.
Since the surprise announcement by the SNB to lower its key rate to 0.5%, variable rate mortgages, based on the Saron, have also decreased. They currently offer interest rates of 1.49% on average. “This means that Saron mortgages are on average slightly cheaper than ten-year fixed-rate mortgages,” explains Felix Oeschger, expert at Moneyland.ch.
>> Review the topic from 7:30 p.m. when the reference rate falls:
Inflation on target
From the point of view of inflation, nothing stands in the way of a further easing of monetary policy in the first half of 2025, estimate the specialists of the online comparator. In November 2024, inflation increased by 0.7% compared to the same month last year, comfortably within the SNB’s 0-2% target range.
Many economists believe that the SNB will lower its key rate to 0% by mid-2025. But even if that happens, the downside potential for fixed-rate mortgages is limited. “This expectation is probably already largely taken into account in the interest rates of fixed-rate mortgages,” notes Felix Oeschger.
>> To reread: Taking advantage of the decline in inflation, the SNB lowers its key rate to 0.50%
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