Interest rates for mortgages have been going down since mid-March this year. The Swiss mortgage index from moneyland.ch currently shows average annual interest rates of 1.25 percent for five-year FRMs and 1.12 percent for two-year FRMs - a multi-year low (refer to the Swiss mortgage index graphic).
For the sake of comparison, one year ago the average annual interest rate for five-year FRMs was more than one percentage point higher at 2.33 percent. The average interest rate for two-year FRMs was 2.31 percent in early June 2024 - more than twice as high as the current average rate.
A steeper interest rate curve
The cost of 10-year FRMs has not fallen as strongly, in terms of annual interest rates, as that of short-term and mid-term FRMs. The average annual interest rate for 10-year FRMs is currently 1.62 percent, which is higher than it was at the start of the year, and also somewhat higher than it was in early 2022.
The result is a much steeper interest rate curve. In other words, the difference between the cost of long-term mortgages and that of short-term mortgages is currently much bigger than it was a year ago.
One year ago, the average annual interest rate for 10-year FRMs was 2.42 percent, while that of 20-year FRMs was 0.11 percent higher at 2.31 percent. Now, the average annual interest rate is 1.62 percent for 10-year FRMs - 0.50 percentage points over the average rate of 1.12 percent for 20-year FRMs. “The possibility that the Swiss National Bank will lower its key interest rate to zero, or even below zero, has had a stronger downward impact on shorter-term mortgages than on mortgages with longer terms,” explains moneyland.ch analyst Felix Oeschger.
Outlook
Most market observers expect that the Swiss National Bank (SNB) will lower its key interest rate from the current 0.25 percent to zero percent on June 19. That expectation is already being priced in to mortgage interest rates.
In a scenario in which the SNB lowered its key interest rate far below zero percent, we could expect to see mortgage interest rates continue to fall. Presently, the inflation rate does not stand in the way of the SNB from lowering its key interest rate. In May 2025, the inflation rate was even slightly negative, at -0.1 percent.
“In the current insecure environment, a return to negative interest rates cannot be ruled out,” says Felix Oeschger. A further strengthening of the Swiss franc - as a result of trade conflicts, for example - is one scenario that could trigger a move to a negative key interest rate.
About the Swiss mortgage index from moneyland.ch
The Swiss mortgage index from moneyland.ch is based on the interest rates that mortgage lenders publish online. These are automatically recorded by moneyland.ch twice daily. For 10-year FRMs, the index shows the daily average of the interest rates from around 30 banks and insurance companies. Additionally, the index also tracks the interest rates of FRMs with other mortgage terms, as well as those of adjustable-rate mortgages, construction loans, and SARON mortgages. In addition to tracking the published guide rates from each lender, moneyland.ch also calculates various metrics like the median, arithmetic average, mode, and minimum and maximum rates across different product groups like online mortgages, mortgage offers from banks, and mortgage offers from insurance companies.
You can find an overview of current mortgage interest rates in the interactive mortgage comparison on moneyland.ch.
You can find useful mortgage calculators here.
More on this topic:
Find current interest rates in the mortgage comparison
Overview of Swiss mortgage interest rates (German PDF)
Graphic: Swiss mortgage interest rate developments (German PDF)
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