Mortgage market sees above-average growth again in 2025
Keystone-SDA
Last year, the Swiss mortgage market grew at an above-average rate for the first time since 2022. However, this does not automatically mean better business for lenders, as margins remain under pressure.
According to the 2025 Mortgage Market Study published on Thursday by MoneyPark and Helvetia, the mortgage market grew by 3.1%, or CHF39 billion, in 2025. This marked the first time the CHF1.3 trillion mark had been exceeded.
This growth was slightly above the ten-year average of 3%. The market had grown by 2.6% in 2024 and by 2.4% in 2023. According to the study, alongside low interest rates and rising property prices, the liquid owner-occupied housing market also contributed significantly to this development.
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Raiffeisen closes gap on UBS
As in previous years, cantonal and Raiffeisen banks accounted for three-quarters of net growth. Specifically, this amounted to CHF29 billion. Both the Raiffeisen banks (+4.6%) and the cantonal banks (+3.9%) recorded above-average growth.
The Raiffeisen banks have thus narrowed the gap with market leader UBS, which, following sharp declines in previous years, was at least able to maintain its volume (+0.1%). The gap now stands at just CHF52 billion.
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Behind the dominant banks, there was a shift. Pension funds narrowly overtook insurance companies as the second-largest providers of mortgages. Overall, however, with shares of 2% and 3% respectively, they account for only a small proportion of the total Swiss mortgage market.
Margins under pressure
However, the higher mortgage volumes did not immediately translate into improved profitability for lenders. The net interest margin fell by 10 basis points year-on-year to 1.16%. Compared with the peak year of 2023, the decline was as much as 24 basis points.
“The rebound in volumes in the mortgage market is therefore not a rebound in earnings,” the report continues. The margin boost from the period of the interest rate turnaround two years ago is gradually being eroded.
Even lower refinancing costs could only counteract the trend to a limited extent. The authors of the study expect margins to remain under pressure in the future as well.
Based on the first quarter and persistently low interest rates, market growth for 2026 is expected to be comparable to that of the previous year. The renewed rise in the number of property transactions, as well as higher property prices, are likely to provide further support for the mortgage market.
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Translated from German, reviewed by an English Department journalist.
