Real estate investment market: price expectations for all segments, locations and regions negative

22 September 2023

  • One year after the interest rate turnaround, professional market participants expect prices to fall across all property segments, regions and locations.
  • Negative expectations push the Swiss Real Estate Sentiment Index to a new all-time low.
  • Interest rate risks, regulations and the risk of falling real estate values cloud the outlook.
  • Just 18% are confident that the 2050 net zero target can be achieved on the defined reduction routes. 
  • Only 3% are convinced that portfolio values consider all forthcoming ESG measures.

Swiss investment real estate is facing a challenging year. This is borne out by the Swiss Real Estate Sentiment Index (sresi®) survey results which reflect the expectations of professional investors, developers, consultants and appraisers for the Swiss real estate investment market. Whilst expectations for economic growth are a little more optimistic than last year, rising to -32.4 pts compared to -51.4 pts in 2022, the assessments of price trends are distinctly negative across all real estate segments at -88.6 pts (2022: -27.7 pts), dragging the sresi® to an all-time low of -77.4 pts (2022: -32.5 pts).

Since the components Economy and Price were weighted 20/80 for the index, they cannot be added together as shown.

Negative assessments of price trends across all segments, locations and regions

For the first time in the over 10-year time series of sresi®, respondents’ assessments of price trends are negative across all real estate segments. This not only applies to peripheral locations, for which almost all of the respondents assume negative price movements. For the first time, assessments of price trends in central locations were also in negative territory.

According to the consolidated responses, no price rises are expected in any of the major regions or economic centres. Last year, respondents were still optimistic in their price expectations for the Lake Geneva region, Zurich and part of central Switzerland. 

Easing on the supply side

In the residential segment, the respondents still rate adequate investment opportunities as scarce, with -60.9 pts. Nonetheless, this figure has improved by a third compared to last year (-103.2 pts). The availability of special-use properties is also rated as scarce, albeit only moderately (-21.6 pts) and is less pronounced than last year (-41.1 pts). The availability rates for office, industrial and retail space have also improved and are now showing a slight plus.

Key risks: interest rates, regulations and possible falls in values

Three components stand out in the respondents’ perception of risk. Like last year, interest rate risks are viewed as the greatest risk at 2.3 out of 3.0 pts. Whilst it was less than half this level in 2020 at 1.1 pts, this figure has risen sharply over the last few years. 

The long-standing former leading risk, the risk of tougher regulation (2.1 pts), is in second place. Besides the well-known policy objective of capping yields and spatial planning challenges, expected measures in the field of sustainability may well have contributed to perceiving this risk at its second-highest level since the launch of the survey.

In previous sresi® surveys, respondents have assessed the risk of falling real estate values as low. In 2023, this risk was ranked third, at 2.0 pts. 

Clear statements on sustainability

Just 18% of those surveyed believe that the 2050 net zero target can be achieved by following the defined reduction routes and associated measures. 

Notable are survey respondents’ views as to whether all the costs and investments needed for ESG measures are included in portfolio values. 86% of respondents believe that this is not, or is only partially the case. Only 3% are convinced that the values consider all forthcoming ESG measures. 

Just 6% of respondents think that the recently published ESG key performance indicators allow market participants to make a meaningful comparison. More than half believe that no comparison at all is possible. According to Beat Seger, partner and real estate expert at KPMG: "Our survey of professional market participants clearly shows that the outline conditions and standards in the area of sustainability need further definition."

Further information and the detailed study can be found at:


The KPMG Swiss Real Estate Sentiment Index (sresi®) serves as an early indicator of anticipated trends in the Swiss real estate investment market. The main index consists of the assessment of economic and price trends in the real estate investment market. In the aggregated index, the assessments of economic conditions are weighted at 20% and the assessments of the price trends at 80%. The sub-indices reflect the expectations of survey participants, with reference to individual market and real estate use segments. Data collection first took place in 2012 and is undertaken annually to generate the indices, allowing market assessments to be compared over time. Around 350 real estate investors and appraisers in the Swiss real estate investment market took part in this year's survey. The survey participants represent an investment and valuation volume of around CHF 350 billion. The survey took place between 14th June 2023 and 25th August 2023.

Dominik Weber
Dominik Weber

Head of External Communications

KPMG Switzerland