Zurich: How The World Capital Of Housing Shortages Is Tackling The Problem

(MENAFN- Swissinfo) In Zurich, only seven out of 10,000 apartments are vacant on average – the lowest rate in Switzerland and probably in the Western world. What's the city doing about its housing crisis? This content was published on April 21, 2025 - 10:30 10 minutes

I write about demographic developments, societal trends and debates in Switzerland. I joined SWI swissinfo after 15 years at a local newspaper in Zurich.

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Anyone looking for somewhere to live in Zurich has a big problem. People joke that the only place you can rest and catch some sleep is in one of the queues to look at the few vacant apartments.

These queues are an all-too-frequent sight in Switzerland's economic powerhouse. A few months ago comedian Lara Stoll made a video that went viral, showing her queueing with about 300 other people to view an apartment.

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The housing market in Zurich has dried up – at least if you go by the vacancy rate. It is calculated on a chosen day and includes all forms of unoccupied housing. At 0.07% Zurich has the lowest rate in Switzerland. Judging by the comparative data available, it may even be the lowest in the West.

SWI swissinfo compared the figures for sought-after cities all over the world. The quality of the data and the way they are gathered vary, but no matter which way you look at it, Zurich stands out.

SWI swissinfo/Kai Reusser

With 450,000 inhabitants, Zurich is Switzerland's largest city. The problem of housing is a long-standing issue, and the pressure is growing all the time. In early April thousands of people took to the streets to demonstrate against the housing shortage.

High price of land

To tackle the problem, the city government set up a new department last year. Philippe Koch is the taskforce manager appointed to deal with the housing shortage in Zurich. He had been a lecturer in municipal politics and urban processes at the Zurich College of Applied Sciences (ZHAW). The media have been calling him“Mister Housing”, a title he's not keen on.

We met Koch along with Anna Schindler, head of urban development for Zurich, at the city hall. Schindler has a corner office looking out over the River Limmat and the tall spire of the Fraumünster church. However, her job and that of Koch is not just to look at the city from a height but from below as well – from the viewpoint of all those who can no longer afford to live in Zurich.

Their mission from the city government is to ensure that by 2050 a third of all rental properties should be non-profit. These should of course be in the low to mid price range. The number of such apartments has stagnated in the city for years, at between 27% and 29% of the total housing stock.

Buy, buy, buy

So what's the city doing?“A lot of buying – more than ever before,” Schindler says. The city has a mandate to do this, and the money for it isn't lacking either. Since the start of 2025 the city, along with non-profit and other building agencies, can draw on a new tranche of CHF300 million ($370 million) from what is called the housing fund.

The structural problems won't be solved just by throwing money at them.“It's a seller's market. The city doesn't have any legal priority as a buyer,” Schindler says.“After a certain point the city just can't keep bidding, as happened with Uetlihof.”

The city of Zurich almost purchased the Üetlihof office complex as a strategic reserve, but the CHF1.2 billion price tag proved too much for a majority of the city's parliament. Keystone / Alexandra Wey

Uetlihof is the former Credit Suisse campus. Since 2012 it has been owned by a major international investor, the Norwegian Government Pension Fund. In 2022 the government of Zurich wanted to buy up this“second-largest contiguous piece of land in the city” for use as a strategic reserve for CHF1.2 billion. However, the motion was narrowly defeated in the city parliament.

This episode illustrates the main problem the city of Zurich is up against: land prices have gone up, and land is what the city currently lacks.“The city sold off a lot of land in the 1980s, and now it costs a great deal more to buy it back,” Schindler explains.

Half the price of an apartment is determined by the price of the land under it. Koch therefore sees one of the ways out of the housing crisis as being the uncoupling of the land and housing markets. One instrument available to government is that city-owned land can be made available to non-profit agencies under the terms of a lease to build. Then again, the city of Zurich has only a limited amount of land to dispose of.

Other instruments whereby private owners can be compelled to build are hard to enforce in Switzerland. One example would be taxing unused or under-used land to put a curb on land speculation. The city of Zurich has been dealing with private owners more with the carrot than the stick approach. Thus it allows a higher occupancy rate (building density), if part of the housing stock is non-profit.

Density and its consequences

The main potential for growth in Zurich is in new buildings to replace old. Additions and expansions to existing buildings are often not a paying proposition for investors. Also from the point of view of the cityscape, Schindler say that“thinking of the urban space”, there are arguments against the idea of just adding an extra floor to every building.

When it comes to new buildings to replace old, they yield on average 87% more housing space owing to increased density, according to a 2023 survey. The problem here is what ensues. With new buildings, rents go up. Part of the tenant group of the old building just have to move out. That happens even in the case of non-profit housing agencies. There is a conflict of aims and an issue of distributive justice – the socially just allocation of resources.

“We need both: subject and object promotion,” Koch adds. In plain language that means that the social services need to provide enough support to low-income earners as well as the city providing non-profit and subsidised housing units.

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