Can a landlord increase my rent every year? – Rent increases in Switzerland

Learn how rent increases work in Switzerland, from reference interest rates to inflation and tenant rights.

The mortgage reference rate: the main driver of rent increases

In Switzerland, the vast majority of rental agreements are tied to the mortgage reference interest rate. This figure, set by the Federal Office for Housing (BWO/OFL), is updated four times a year—in March, June, September, and December. The new rate takes effect the very next day after publication.

The mortgage reference interest rate is calculated by the Swiss Federal Office for Housing (BWO/OFL) based on the average interest rates of outstanding domestic mortgages. These figures are collected from banks across the country and rounded to the nearest quarter percent. 

This system was introduced in 2008 to replace varying cantonal benchmarks, creating a unified and transparent standard across the country.

There are, however, exceptions. Housing cooperatives, subsidized apartments, and contracts with indexed rents follow different rules. Indexed contracts, for instance, track inflation directly through the Swiss consumer price index, rather than the reference rate.

When does a rent increase apply?

A landlord cannot raise the rent at will—any adjustment must align with the official termination dates and respect notice periods. By law, tenants must be informed at least three months plus 10 days in advance.

Example: If a rent increase is to take effect on October 1, 2024 (the day after the next termination date), the landlord's notice must reach the tenant no later than June 21, 2024.

Termination dates differ by canton and municipality. In many regions, the standard dates are March 30 and September 30, but some areas allow terminations at the end of each month or quarter. The contract itself is decisive: if it specifies certain dates, those take priority.

By how much can a landlord raise the rent?

Swiss law links rent increases directly to movements in the reference rate:

• +3% rent per +0.25% reference rate (if the rate is under 5%)
• +2.5% per +0.25% (if the rate is between 5% and 6%)
• +2% per +0.25% (if the rate exceeds 6%)

At today’s level (below 5%), an increase of 0.25% in the reference rate justifies a rent rise of 3%.

Whether this applies to you depends on the rate mentioned in your contract or at your last rent adjustment. If the new reference rate is higher than that baseline, your landlord may increase the rent accordingly. If not, no rent increase is allowed on this basis.

Other valid reasons for a rent increase

Apart from interest rate movements, Swiss tenancy law recognizes several additional grounds:

• Inflation: Up to 40% of the inflation rate (based on the Swiss consumer price index) can be passed on by the landlord.
• Operating costs: Annual general cost increases of 0.5–1% (e.g., insurance, maintenance) may be charged to tenants.
• Value-enhancing renovations: If the landlord invests in improving the property—such as energy-efficient refurbishments—part of these costs can be reflected in higher rent. Routine maintenance, however, does not count.

Can tenants demand a rent reduction?

Yes. The system works both ways. If the reference rate drops compared to the one stated in your rental contract, the tenant is entitled to request a rent reduction from their landlord. Temporary reductions are also possible if defects or breakdowns reduce the livability of the property.

To exercise this right, tenants have to submit a written request (preferably by registered mail) within the proper notice period. If the landlord does not respond satisfactorily within 30 days, the case can be taken to the local arbitration authority.

What can landlords do to protect themselves from disputes?

Landlords can minimize the risk of legal disputes by using the official cantonal form, clearly stating the legal grounds for the increase, and keeping precise documentation of reference rates, inflation data, or renovation costs. Providing tenants with understandable explanations and supporting documents reduces the likelihood of objections. 

What can tenants do if they disagree with a rent increase?

If tenants believe a rent increase is unjustified or excessive, they have the right to challenge it. Any increase must be communicated using the official cantonal form and properly justified, for example by referencing the mortgage reference rate or value-adding investments. If the reasoning seems insufficient, tenants can contest the increase within 30 days at the local arbitration authority. 

Property value incrases due to renovations can justify a rent increase. Calculate your property value now in just a few minutes using our online valuation tool: https://acheteur.ch/en/property-valuation