Summary
The mortgage reference interest rate for rental relationships in Switzerland remains unchanged at 1.25 percent. The rate has been in effect since September 2, 2025 and will only be adjusted if the underlying average interest rate falls below 1.13 percent or rises above 1.37 percent. Since the average interest rate changed only minimally compared to the previous quarter from 1.33 to 1.32 percent, tenants have no new claim to rent reduction. However, tenants with older contracts based on a higher reference interest rate may continue to assert reduction claims.
Persons
- Federal Housing Office (BWO)
Topics
- Rental law and rent setting
- Mortgage interest rates
- Swiss housing market
- Consumer protection
Clarus Lead
The reference interest rate remains stable and signals continuity in the Swiss rental market. For landlords and tenants, this means planning security in the first quarter of 2026. The rate is based on the volume-weighted average interest rate of domestic mortgage loans and is adjusted quarterly – a mechanism that links rent increases to objective market data.
Detailed Summary
The Federal Housing Office (BWO) has confirmed the mortgage reference interest rate for rental relationships. At 1.25 percent, the rate has remained unchanged since September 2025 and will continue at this level from March 3, 2026 onwards. This rate serves as a benchmark for rent setting throughout Switzerland and is published rounded to commercial standards.
The stability results from the minimal change in the underlying average interest rate: it declined only slightly from the previous quarter from 1.33 to 1.32 percent (reference date December 31, 2025). The adjustment band is deliberately set broadly – the rate only changes if the average interest rate falls below 1.13 or rises above 1.37 percent. This means that the current situation does not create any new claims for reduction or increase.
However, tenants whose rent is still based on an older reference interest rate of 1.5 percent or higher may continue to assert a reduction claim. The rental contract or the last notice of rent adjustment provides information about the current reference interest rate. Exceptions apply to indexed or graduated rents as well as turnover rents for business premises. Additional regulations may apply for subsidized housing.
In addition to the reference interest rate, other factors such as inflation (up to 40 percent applicable) and changes in maintenance and operating costs may lead to rent adjustments.
Key Points
- The mortgage reference interest rate remains at 1.25 percent – unchanged since September 2025
- Adjustments only occur if the rate falls below 1.13 percent or exceeds 1.37 percent
- Tenants with older contracts (reference interest rate ≥ 1.5 percent) continue to have reduction claims
- Additional cost factors such as inflation and operating costs can be considered in parallel with rent adjustments
- Quarterly publication by the BWO ensures transparency and planning security
Critical Questions
Data Quality: Is the calculation of the average interest rate based on complete data from all domestic mortgage claims, or are there gaps for certain banking groups?
Conflicts of Interest: Which interest groups (landlords, tenants, banks) influence the setting of the band (1.13–1.37 percent), and how is neutrality ensured?
Causality: To what extent does the reference interest rate also account for market distortions caused by major banks or regional differences in mortgage lending?
Feasibility: How is it ensured that tenants actually assert their reduction claims if they do not know the applicable reference interest rate of their contract?
Source Directory
Primary Source: Mortgage Reference Interest Rate for Rental Relationships Remains at 1.25 Percent – news.admin.ch, March 2, 2026
Verification Status: ✓ March 2, 2026
This text was created with the support of an AI model. Editorial Responsibility: clarus.news | Fact-Checking: March 2, 2026