Demand has exceeded supply for a long time

Due to the persistently low interest rate level, demand in the centers and in the conurbation has already exceeded supply for some time. This led to a further rise in rents and purchase prices for properties in central locations in 2019. In Zurich, for example, the counter-trend to "urban exodus" has been observed for some time now. The growing interest in central residential locations has led to housing becoming an even more scarce commodity and prices soaring. They became unaffordable for many people. So it is not surprising that many people extended their search to rural areas in previous years. The trend to move from the city to the countryside in order to get more living space or to realize the dream of owning your own house existed even before the Corona pandemic.

The experiences from the lockdown act as a catalyst

While many city dwellers in the Corona lockdown literally sat within their own four walls, people in the more rural areas had the opportunity to linger on the large balcony or in the garden much more often. The time spent at home has certainly caused many city dwellers to rethink their priorities when choosing a place to live. Whereas before the pandemic, proximity to the place of work and cultural offerings were of great importance, today many people feel that the stress of density and the lack of a change of scene reduce the quality of life. And the realization that home office is a good and more frequent option in many professions also means that for many people, completely new perspectives are opening up when looking for property. Because if the annoying commuting in crowded trains is eliminated, many can well imagine living outside the centers. Nevertheless, it is clear that it is not uncommon for people to look for property in the city or in the rural agglomeration due to a lack of offers.

"De Füfer unds Weggli" – Living with a turnaround in the city

Because as it turns out, 4.5 to 6 rooms apartments and houses in the city, which have balcony or garden, would be the absolute desire candidates of many searchers. Since this kind of real estate enjoyed however already before the Corona Pandemie of large popularity, their prices rose already in the last years clearly. For the apartment or home search in the city is aggravated by the fact that large urban centers such as Zurich have very low vacancy rates. Anyone looking for a new home in the near future will therefore quickly extend their search radius to the more rural areas.

Will the recession bring a major standstill?

Many reports on "corona-induced urban exodus" assume that this is a temporary phenomenon. The lockdown would only have strengthened romanticized ideas of rural life. While many experts actually assume that it is a temporary phenomenon - as already seen in similar historical events - many financial experts draw dark clouds in the "real estate sky". For the predicted recession hangs over the economy like a sword of Damocles. Although some financial experts assume that retail space and luxury real estate in particular (UBS Real Estate Study, March 2020) is likely to undergo a massive value adjustment, we are less pessimistic about the coming months. As long as the stock market continues to rise, some sectors of the economy as well as assets such as gold and real estate are likely to enjoy strong demand. Because just as likely as the negative scenarios, the scenario is that the priority will shift from consumer goods to material assets and that the and the coming inflation will thus continue to push up the prices of material assets.