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The aggregated Swiss Real Estate Sentiment Index (sresi®) is a measure of the expectations of market players for developments over the next twelve months and is generated on the basis of an assessment of the economic developments and the movement of prices on the real estate investment market.

The index reflects the assessment of over 300 survey respondents who represent an investment and appraisal volume of up to CHF 300 billion. Since it was launched in 2012, the sresi has established itself as a leading qualitative indicator of forthcoming developments in the Swiss real estate investment market.

Beat Seger explains the most important findings of the 2020 study:

The sresi has reached the lowest value since the beginning of the study

With -13.1 points, the aggregated Swiss Real Estate Sentiment Index has reached the lowest value since the beginning of the study whereas the index was at its highest in the previous year (+32.8 points).

Negative assessment of the economic situation

With an index of -73.8 points (previous year: -10.1 points), the survey respondents’ assessment of the evolution of the economic situation over the next twelve months reflects the broad consensus about the strong deterioration of the economic situation.

Stable prices are expected on the whole

Despite the negative assessment of the economic situation, the survey respondents expect, with an index of +2.1 points, a stable price evolution for real estate investments (previous year: +43.5 points).

Whereas a stable price evolution is expected for the market as a whole, the sub-indices for locations and segments differ significantly:

  • Residential properties: The price expectation index of +68.0 pts and the offer index of -108.0 pts show that market participants still consider that residential properties are the preferred real estate investment in Switzerland, which results in a high shortage of appropriate investment possibilities.
  • Retail properties: The index for retail properties has been negative since the beginning of the survey and has reached a new low at -146.8 pts.
  • Office spaces: At -73.4. pts, the price index is near the all-time low of 2013 and is impacted by the strongly negative assessment of future demand for these spaces in the extended commercial belts.
  • Locations: With +75.2 pts, central locations continue to show a price increase potential. Price expectations for middle centers are slightly negative at -0.4 pts. The negative assessment of price movements in peripheral locations has become more accentuated with -92.1 pts. 

COVID-19 leaves clear marks

The coronavirus has put its stamp on the current year in nearly all areas of life. Concerning the real estate investment market, the survey respondents also expect changes, especially as regards future demand for commercial spaces. Indeed, 89% of the survey respondents expect that remote working (e.g. home office) will gain in importance. Moreover, 87% of the respondents expect a slowdown in the development/realization of commercial spaces and 69% expect a lasting decrease of the number of visitors in shopping centers.

The assessment of the questions regarding the impact of COVID-19 on the real estate investment market clearly shows where the survey respondents see winners and losers:

  • Logistics: Logistics spaces are the great winners in terms of demand. Indeed, 71% of the survey respondents expect an increase in the demand for these spaces.
  • Health and care: According to 54% of the survey respondents, properties devoted to healthcare and nursing can benefit from a rise in demand.
  • Residential: The majority (56%) of the survey respondents expect demand to remain stable.
  • Offices: 43% of the survey respondents expect a decrease in demand in CBDs, and in extended business area 76% of the survey respondents expect a decline in demand for these spaces.
  • Hotels: 83% of the survey respondents expect a decrease in demand and paint a bleak picture of the situation.
  • Retail: The most significant decline in demand is expected by 88% of the survey respondents for retail spaces in shopping centers; this is even more pronounced as the negative evolution in demand for out-of-town locations expected by 74% of the survey respondents.

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Further information

Press release

Players on Switzerland’s real estate investment market anticipate a difficult market environment in the next twelve months.

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