1,900 people search every month for "mortgage affordability Switzerland". The central question when buying a home: can I afford it? In Switzerland there are clear rules — defined by FINMA. This guide explains the calculation step by step.
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To the affordability calculator →The Swiss affordability rule
In Switzerland the rule is: the annual housing cost may amount to no more than 33% of gross income. This is not calculated using the current interest rate, but with an imputed interest rate of 5% — a safety buffer prescribed by FINMA.
The three cost components
- Imputed mortgage interest: 5% on the entire mortgage (not the current market rate!)
- Amortisation of the 2nd mortgage: 1% per year (or repayment within 15 years down to 65%)
- Ancillary costs: 1% of the purchase price per year (maintenance, insurance, repairs)
Worked example
Purchase price: CHF 1'500'000
Equity: CHF 300'000 (20%)
Mortgage: CHF 1'200'000
Imputed interest (5%): CHF 60'000/year
Amortisation (1% on 2nd mortgage): CHF 2'250/year
Ancillary costs (1%): CHF 15'000/year
Total: CHF 77'250/year = CHF 6'437/month
Required income (33%): CHF 234'091 gross/year
Equity: the 20% rule
At least 20% of the purchase price must be contributed as equity. Of this, no more than 10% may come from the pension fund (2nd pillar). The remaining 10% must come from "hard" funds: savings, pillar 3a, an advance on inheritance, or a gift.
Current vs. imputed interest rate
The current mortgage interest rate is around 1.5-2.1% (as of April 2026). Banks, however, calculate with 5% — almost three times as high. Why? Protection against rising interest rates. If rates were to climb to 5%, the mortgage must still remain affordable.
Practical tip: Some banks no longer calculate with 5% for clients over 55, but with the effective rate plus a surcharge. Ask about it.
5 ways to improve affordability
- More equity: Every additional franc reduces the mortgage and thereby the imputed burden.
- Second income: A partner's income is counted (provided it is verifiable).
- A cheaper property: CHF 100'000 less on the purchase price saves ~CHF 7'000 in annual burden.
- Reduce debt: Leasing and loans are deducted in the calculation.
- A renovation property: Buy more cheaply, renovate later (an increased mortgage is possible).
Frequently asked questions
What does "imputed interest rate" mean?
The imputed interest rate (currently 5%) is a theoretical interest rate that banks use for the affordability calculation. It is intended to ensure that you can still service the mortgage if interest rates rise. The actual mortgage rate is considerably lower.
Can I afford a property with less than 20% equity?
As a rule, not for residential property. Exceptions: renovation mortgages (up to 90% loan-to-value) or where additional collateral is available (e.g. other properties). Speak with your bank.
Is a bonus counted towards income?
Regular bonuses (verifiable for at least 3 years) are usually counted at 50-80%. One-off bonuses or variable remuneration count for less. Banks distinguish between guaranteed and variable income.
Calculation based on FINMA guidelines, as of April 2026. Individual bank terms may differ.