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  #21  
Old 17.10.2011, 12:21
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Re: Housing prices in Zurich

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So what happened in the 1990's?

(just curious?....... If I was to follow a 'trend', I'd be interested in the triggers to see if history was to repeat itself?)
SNB hiked rates to cool the housing market.

currently, we're seeing the opposite, where rates have been held low for a long time which is pumping up the market again and will lead to another boom (and bust?) cycle.

the only difference is that perhaps the rates are going to be sustained at a low rate for longer which means the house prices are probably going to get more out of control.

the way i see it, there will be run-away general inflation and an eventual collapse of the CHF unless the euro recovers and the SNB manages to un-print all the CHFs it has printed through QE and the currency peg.
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  #22  
Old 17.10.2011, 12:21
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Re: Housing prices in Zurich

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Because when you look at it it gives an impression that the market is stable, when the underlying price has risen significantly...
only if you don't know how to read a chart you can easily see the years were there were double digit rates of growth. hardly 'stable' by any measure.

to be honest, the price graph is more mis-leading because it doesn't start from a zero axis and so visually exaggerates the price changes...
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  #23  
Old 17.10.2011, 12:26
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Re: Housing prices in Zurich

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only if you don't know how to read a chart you can easily see the years were there were double digit rates of growth. hardly 'stable' by any measure.

to be honest, the price graph is more mis-leading because it doesn't start from a zero axis and so visually exaggerates the price changes...
I suggest you read this [ Confirmation Bias ]... as you clearly chose that chart based on your perception of the market. Which brings us to my original answer... (i.e. answer will depend on people's underlying opinions)
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  #24  
Old 17.10.2011, 12:27
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Re: Housing prices in Zurich

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Because when you look at it it gives an impression that the market is stable, when the underlying price has risen significantly...
To give a correct picture, your graph should be on a log scale.
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  #25  
Old 17.10.2011, 12:34
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Re: Housing prices in Zurich

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I suggest you read this [ Confirmation Bias ]... as you clearly chose that chart based on your perception of the market. Which brings us to my original answer... (i.e. answer will depend on people's underlying opinions)
the only thing it is confirming is your own bias.
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  #26  
Old 17.10.2011, 12:34
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Re: Housing prices in Zurich

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SNB hiked rates to cool the housing market.
And capital gains tax (Grundstückgewinnsteuer) was introduced to stop speculation...
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Old 17.10.2011, 12:34
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Re: Housing prices in Zurich

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To give a correct picture, your graph should be on a log scale.
Reasoning?

The log scale on the time series will exaggerate the increase so not sure if it's a correct picture.

On the percentage change chart, it doesn't make any sense.

Anyway...

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the only thing it is confirming is your own bias.
I think we're both clear about BOTH of our biases :-p
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  #28  
Old 17.10.2011, 12:40
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Re: Housing prices in Zurich

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And capital gains tax (Grundstückgewinnsteuer) was introduced to stop speculation...
given that the SNB will have limited room to adjust on rates, i expect we might get further fiscal measures to dampen house prices.
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  #29  
Old 17.10.2011, 13:52
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Re: Housing prices in Zurich

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given that the SNB will have limited room to adjust on rates, i expect we might get further fiscal measures to dampen house prices.
so does your crystal ball say rates are going up? I saw a report by Credit Suisse and their forecast is the LIBOR rate to stay flat over the next year, but the fixed term rates to go up by 50 to 90 basis points, depending on the term.

We need to sign the papers for our bank in the very near future, and being lazy and not fully understanding the way LIBOR works - we are thinking of doing a 2 year fixed at 1.4%. I do think rates will go up (I mean really, this time, how can they go down?) - but I don't think they will rise significantly (just a guess or wishful thinking). So our thoughts are to lock in a low 2 year rate, watch and learn, and then hopefully really know what to do

Crazy, dumb, or sound? I guess LIBOR ultimately will give us the lowest rates (right now where we are financing it is 1.18% for the 3 year term and 3 month LIBOR basis, 1.08% for the 5 year term 3 month basis) - but I guess the uncertainty of it makes us hesitant to go that way (I should say makes my SO hesitant, and as he makes the money, he gets a say too!)
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  #30  
Old 17.10.2011, 13:56
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Re: Housing prices in Zurich

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so does your crystal ball say rates are going up? I saw a report by Credit Suisse and their forecast is the LIBOR rate to stay flat over the next year, but the fixed term rates to go up by 50 to 90 basis points, depending on the term.

We need to sign the papers for our bank in the very near future, and being lazy and not fully understanding the way LIBOR works - we are thinking of doing a 2 year fixed at 1.4%. I do think rates will go up (I mean really, this time, how can they go down?) - but I don't think they will rise significantly (just a guess or wishful thinking). So our thoughts are to lock in a low 2 year rate, watch and learn, and then hopefully really know what to do

Crazy, dumb, or sound? I guess LIBOR ultimately will give us the lowest rates (right now where we are financing it is 1.18% for the 3 year term and 3 month LIBOR basis, 1.08% for the 5 year term 3 month basis) - but I guess the uncertainty of it makes us hesitant to go that way (I should say makes my SO hesitant, and as he makes the money, he gets a say too!)
personally, i took 1/3 LIBOR rates and 2/3 10 year fixed rates.
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  #31  
Old 17.10.2011, 14:01
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Re: Housing prices in Zurich

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personally, i took 1/3 LIBOR rates and 2/3 10 year fixed rates.
do you have minimum Tranchen for the LIBOR - our is 200k and I am not sure if that means just a minimum or if it has to be in multipliers of 200k. For some reason I was under the impression that had to be 200k or a multiplier, but now I am not sure. Probably need to call our loan adviser and try and understand her . Are yours split up between the 1. and 2. hypothek (with LIBOR being the 2.?)
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  #32  
Old 17.10.2011, 14:13
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Re: Housing prices in Zurich

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do you have minimum Tranchen for the LIBOR - our is 200k and I am not sure if that means just a minimum or if it has to be in multipliers of 200k. For some reason I was under the impression that had to be 200k or a multiplier, but now I am not sure. Probably need to call our loan adviser and try and understand her . Are yours split up between the 1. and 2. hypothek (with LIBOR being the 2.?)
i can't remember. i just told the advisor what i wanted and he said it was possible.

not sure which is the first mortgage and which the second, but the amortisation is 1% of the total which is taken against the fixed portion.

i was going to go for 50/50 split between LIBOR and 10 year fix, but since i was quitting my job, i figured that it would be better to be on the secure side.

the idea behind the LIBOR is that it is fully flexible so if rates shoot up to 10%, then i have the option of repaying the entire amount which reduces my exposure to high rates.
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  #33  
Old 19.10.2011, 16:19
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Re: Housing prices in Zurich

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In my area (Ausserschwyz) there most definitely is a bubble; prices have skyrocketed.

To give you an idea, I bought our home 8 years ago for a (for Switzerland ) modest price. There are 5 other houses in the Quartier with the same floor plan - albeit less than half the land we have.


This is beyond crazy.


(Oh how I wish I could put my house on the market... but we can't find anything suitable in the area. Can't sell until we have somewhere to go.)
Indeed the house values are worth not as much as you need a primary residence anyway. But it sure helps if downgrading.
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  #34  
Old 19.10.2011, 16:24
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Re: Housing prices in Zurich

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(Oh how I wish I could put my house on the market... but we can't find anything suitable in the area. Can't sell until we have somewhere to go.)
you could always sell and rent. or rent out and rent
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  #35  
Old 19.10.2011, 16:55
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Re: Housing prices in Zurich

My observations on Ticino:

I am seeing too much development and refurbishment in Ticino.
I think that it is unsustainable.

There appears to be a lot of empty property available for rent as well.
The rent rates seem to be falling as well.

From what I am reading in this thread; Ticino must be a totally different market.
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  #36  
Old 19.10.2011, 17:16
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Re: Housing prices in Zurich

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you could always sell and rent. or rent out and rent
Frying pan into the fire comes to mind.

(3 dogs, one of whom is, despite my concerted efforts, still a Belltie... Renting would be a nightmare.)

No, we're staying put for now. Once the sad day comes when the oldie is no longer here, then the Angel, the Asbo-hound, and I will head back home. Where we will have the isolated space I need to effectively train the little s*d. Then I'll likely come back - and hopefully by then there might be something interesting on the market.

Or maybe I'll stay back home, and enjoy the Lake Michigan shore.

It sure would be nice to sell into this market, but not possible at the moment. All I really hope for is not losing money on this house - I look at a property as a roof over my head first, investment a distant second.
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Old 19.10.2011, 17:25
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Re: Housing prices in Zurich

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Frying pan into the fire comes to mind.

(3 dogs, one of whom is, despite my concerted efforts, still a Belltie... Renting would be a nightmare.)

No, once the sad day comes when the oldie is no longer here then the Angel, the Asbo-hound, and I will head back home. Where we will have the isolated space I need to effectively train the little s*d. Then I'll likely come back - and hopefully by then there might be something interesting on the market.

Or maybe I'll stay back home, and enjoy the Lake Michigan shore.

It sure would be nice to sell into this market, but not possible at the moment. All I really hope for is not losing money on this house - I look at a property as a roof over my head first, investment a distant second.
Even if you sell your Swiss property for what you paid for it 5 years ago, you will have made a killing in most other currencies...
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  #38  
Old 19.10.2011, 17:33
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Re: Housing prices in Zurich

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Even if you sell your Swiss property for what you paid for it 5 years ago, you will have made a killing in most other currencies...
And pay a rather painful bill to Uncle Sam.

US Capital gains on property abroad are figured at the dollar exchange rate on the date of purchase against the dollar exchange rate on the date of sale. Given the tanking dollar, selling at even no CHF profit means an eye-popping USD paper profit... upon much of which I would owe tax. Yet another benefit of that blue passport...

Nah, I'm sitting tight for now.
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  #39  
Old 19.10.2011, 18:24
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Re: Housing prices in Zurich

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And pay a rather painful bill to Uncle Sam.

US Capital gains on property abroad are figured at the dollar exchange rate on the date of purchase against the dollar exchange rate on the date of sale. Given the tanking dollar, selling at even no CHF profit means an eye-popping USD paper profit... upon much of which I would owe tax. Yet another benefit of that blue passport...

Nah, I'm sitting tight for now.
Land of the free ? land of the financially shackled it would seem...
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Old 19.10.2011, 18:51
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Re: Housing prices in Zurich

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And pay a rather painful bill to Uncle Sam.

US Capital gains on property abroad are figured at the dollar exchange rate on the date of purchase against the dollar exchange rate on the date of sale. Given the tanking dollar, selling at even no CHF profit means an eye-popping USD paper profit... upon much of which I would owe tax. Yet another benefit of that blue passport...

Nah, I'm sitting tight for now.
Hey, at least the dollar isn't as bad anymore as it was in August!
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