For many the dream of living in their own four walls remains denied. But now in the canton of Zurich a simple idea to promote 30-year-olds is coming up.
Young people today hardly have the chance to buy their own home or condominium. On the one hand, the supply in metropolitan areas such as Zurich or Geneva is very scarce.
On the other hand, financing is becoming increasingly difficult because prices have already risen very sharply and banks are becoming more and more restrictive in lending money due to regulatory requirements.
Proposal in the works
On Monday evening, Zurich FDP politician and director of the two homeowners associations in the canton as well as the city of Zurich, Albert Leiser, presented an idea to improve the situation at the Real Estate Circle of the Zurich University of Applied Sciences (ZHAW). muula.ch was there.
According to Leiser it is not uncommon for 30-year-olds to run into financing problems when they want to buy their own home or condominium in the canton of Zurich. They have not yet saved any large assets in the 2nd and 3rd pillars, and banks will only finance a maximum of 80 percent due to the risk limits.
The proposal in the canton of Zurich, however, is for the state to contribute 15 percent of the financing value via a guarantee. Prospective buyers would thus get 95 percent of their property financed at a young age.
The aim of the approach is to use the good incomes that young families often have to reach the regulatory financing level of 80 percent by the age of 50.
Win-win for all
For the canton, this would have numerous advantages. Property owners, for example, are much more settled and long-term oriented than are tenants. Owners are therefore much more stable, Leiser emphasized.
In addition, home owners would pay much more attention to being good neighbors or getting involved in the community. So there is a clear added value, he emphasized.
Ways to increase homeownership were discussed at the Real Estate Circle panel discussion. (Image: z.V.g.)
For the 30-year-olds it would also have advantages. These individuals can first realize their dream of owning their own home.
Taking the upswing with them
Over the 20 years of paying off the 15 percent of the financing amount, they also benefit from appreciation. So they don’t just start at the age of 50 or later, when they have saved up the 20 percent of their own contribution.
But there is yet another advantage. The risk for the canton of Zurich decreases with each year of repayment. After seven years, the risk of default has already fallen by 50 percent to 7.5 percent of the original financing.
Hardly any speculation
At the Real Estate Circle it also became clear that the desire for property would not be made at all from yield consideration.
Holger Hohgardt, lecturer at the ZHAW, made clear on the basis of a survey for the Federal Office for Housing (BWO) that the dream rather stems from the fact that the persons would have a long-term home (92 percent of the answers).
The will to be able to shape the place of residence according to one’s own ideas was also a main reason for the desire to own property (81 percent).
Not having to pay money to a landlord was also cited by many respondents (75 percent). Here it becomes clear that a dependence on a bank is judged less badly than the dependence on a landlord, explained Hohgardt further.
Real estate manager Davide Merico of Moneypark introduced another exciting aspect at the event. Thus among prospective buyers often completely wrong knowledge exists over their situation.
In a questioning of the real estate portal approximately 25 per cent of the tenants indicated that they would not fulfill the criteria for a financing without knowing it, however exactly.
Also, with so-called green mortgages – which exist only for particularly pollution-free real estate – a majority of the people surveyed did not know whether they even qualified for it, or not.
All of this shows that realizing the dream of owning a home does not necessarily have to be just a matter of money. If necessary, the canton may soon guarantee part of that financing.