Increase of the mortgage reference rate


Increase of the mortgage reference rate – rent increases of 3 percent in sight

The mortgage reference rate was introduced in 2008 with the aim of harmonizing the rent structure on the nationwide Swiss level. It is determined quarterly by the Federal Office of Housing (FOH) and is decisive for rent adjustments in existing tenancies. Since its introduction, the mortgage reference rate has fallen steadily and reached a historic low of 1.25% on March 3, 2020, at which it had since remained set.

Today, the FOH increased the mortgage reference rate for the first time in over 14 years, setting it at 1.5%. The new mortgage reference rate will apply from June 2, 2023.

If the required contractual conditions under the relevant lease agreements are in place, this adjustment of the mortgage reference rate entitles the landlord to unilaterally increase the rent by up to 3% (subject to further increases based on other factors such as inflation) as of the next possible termination date.

Landlords who wish to exercise this right may assert these increases in compliance with the contractual and statutory form and deadline requirements. In any case, increases must be notified using an official form, must include a justification and must be delivered at least 10 days before the start of the notice period. When sending the rent increase notification by registered letter, it should be noted that in case of failed delivery on first attempt, delivery is deemed to have taken place only after the expiry of the postal seven-day collection period.

The tenant has the right to terminate the lease agreement within the cooling-off period or to contest the rent increase within a 30-day period starting from notification of the rent increase.

If you have any queries related to this Bulletin, please refer to your contact at Homburger or to: