The mortgage reference rate and what it triggers for rent
The reference rate is the only interest rate that feeds straight through into Swiss tenancies. When it rises, rent may go up; when it falls, the tenant may ask for a reduction. The same rules apply in both directions, and either way the change bites only at the next termination date.
The rate is published quarterly by the Federal Housing Office; it derives from the average interest rate on domestic mortgage claims and moves in quarter-point steps. The value currently in force is available from the FHO. What counts for an adjustment is always that published rate, never the rate on your own mortgage.
How an adjustment works formally
- 1The adjustment takes effect at the next ordinary termination date, observing the notice period plus ten days.
- 2Notice must be given on the official form approved by the canton, with reasons. An increase sent as an ordinary letter is void.
- 3The reasons state the movement in the reference rate separately from other factors such as inflation or higher maintenance costs.
- 4The tenant may contest the increase before the conciliation authority within 30 days.
A falling reference rate creates no automatic entitlement: the tenant has to ask for the reduction. As landlord you may in turn set off accumulated cost increases you have not yet passed on. Keeping clean records of every earlier adjustment therefore pays for itself.
These articles set out Swiss law in general terms and are not a substitute for legal advice on an individual case. Cantonal rules differ. In a dispute, contact the rent conciliation authority or a lawyer.