The Swiss mortgage market consists of three main variants: fixed-rate mortgage (fixed interest rate for a term of 2-15 years), SARON mortgage (variable, linked to the Swiss reference interest rate) and variable mortgage (old term — today usually a SARON mortgage). Current market rates are 0.65-1.10 % for SARON and 1.55-1.65 % for 5-10-year fixed-rate mortgages. This guide compares all variants directly, including advantages and disadvantages, mixed strategies and recommendations for different buyer groups.
Three main variants: 1) Fixed-rate mortgage — fixed interest rate for the selected term (2/5/10/15 years), maximum planning certainty. 2) SARON mortgage — variable interest rate, linked to the Swiss reference interest rate, adjusted quarterly, cancellable at any time. 3) Variable mortgage — historically a separate type, today usually a renamed SARON mortgage. Banks often offer combinations (tranche model): splitting the total mortgage into 2-3 mixed variants.
Advantages: Complete planning certainty over the term (typically 5-10 years), protection against interest rate rises, simple budgeting. Disadvantages: Higher interest rates than SARON in normal market phases (premium of 50-80 basis points), strict cancellation restrictions — early termination often triggers an early repayment penalty of several thousand francs, no benefit from interest rate cuts. Suitable for first-time buyers and conservative profiles.
Advantages: Lower interest rate in most market phases (historically cheaper than a fixed-rate mortgage in 80-90 % of years), maximum flexibility (3-6 months' notice), benefits directly from SNB rate cuts, no interest adjustment risk when refinancing. Disadvantages: Full exposure to interest rate rises, quarterly fluctuations make budgeting more difficult, psychological stress in volatile market phases, need for a liquidity reserve.
Four criteria are decisive: risk tolerance (fixed-rate mortgage for low tolerance), investment horizon (fixed-rate mortgage for 10+ years, SARON for a shorter horizon), liquidity (SARON requires a CHF 30'000-50'000 reserve for interest rate shocks), market phase (SARON is more worthwhile when yield curves are steep). A 50/50 mixed strategy is the most commonly chosen option: 50 % SARON for flexibility and interest advantages, 50 % 10-year fixed for security.
In addition to the nominal interest rate, there are further costs: processing fees (CHF 250-1'500 depending on the bank), valuation fees for the property (CHF 500-1'500), notarisation of the mortgage guarantees (0.1-0.3 % of the mortgage amount), land register fees (CHF 200-500). For a CHF 800'000 mortgage, this amounts to CHF 2'500-6'000 in one-off costs. On renewal, there are normally no additional fees.
At current rates (SARON ~0.85 %, 10-year fixed ~1.65 %), the difference is historically small — SARON's interest advantage is limited. Recommendation for 2026: a 50/50 tranche mix or a pure 10-year fixed-rate mortgage for maximum security. For those speculating on rate cuts: SARON. Forward mortgages (fixing the interest rate today for payout in 6-24 months) are currently recommended for upcoming property purchases or renewals.