Demographic Risks in the Mortgage Market: Ten Cantons Under Pressure

Divided Growth

A joint study by MoneyPark and the Demographic Institute, published in January 2026, provides a differentiated picture of the Swiss real estate market. While eleven cantons are remaining on a stable growth path thanks to sustained immigration, ten cantons face structural challenges. Demographic trends are weakening the demand for housing there, with measurable effects on real estate prices and mortgage collateral.

Of the approximately CHF 1,271 billion total volume of the Swiss mortgage market at the end of 2024, around CHF 300 billion is attributable to cantons where housing demand is expected to decline over the long term according to forecasts. This corresponds to just under a quarter of the total market volume.

The Ten Affected Cantons

The study classifies the following cantons as demographically at risk: Ticino, Bern, Neuchâtel, Jura, Appenzell Ausserrhoden, Nidwalden, Obwalden, Graubünden, Glarus, and Schaffhausen. Together, these regions represent around 23 percent of the national mortgage volume.

The common characteristic: population growth in these cantons occurs almost exclusively in the 65+ age group. This segment of the population rarely moves and hardly generates demand for new apartments or single-family homes. At the same time, the working-age population is shrinking—those who typically buy or rent residential property.

Early Signs in Ticino, Graubünden, and Jura

Structural changes are already visible in the market in some cantons. In Ticino, Graubünden, and Jura, analysts are observing longer marketing periods and increasing price reductions in real estate transactions. Sellers have to factor in longer waiting times, and transaction prices are diverging more frequently from initial asking prices.

Demographic changes have a slow effect. However, once the imbalance between supply and demand reaches a critical level, their impact on real estate markets can be considerable.

Banks with Concentrated Portfolios Particularly Exposed

Regional and cantonal banks whose mortgage portfolios are geographically concentrated are particularly exposed. Without broad diversification, they carry cluster risks, which in the event of a market downturn in affected cantons directly impact their balance sheet.

For mortgage borrowers, the risks arise on several levels: A decline in the value of the property can worsen the loan-to-value ratio, which in the case of refinancing may lead to margin calls. In addition, liquidity suffers. Properties in demographically weak locations are harder to sell and fetch lower prices.

MoneyPark CEO Lukas Vogt emphasizes that the market is overall better capitalized today than in the 1990s, making a systemic collapse unlikely. Nevertheless, Demografik CEO Hendrik Budliger expects dramatic price reductions in certain regions, because current valuations are partially based on expectations of further growth which will not be met for demographic reasons.

The Sentiment Factor

Special attention should be paid to the dynamics of sentiment. As long as owners in affected cantons believe in the value retention of their properties, they hold back from selling. If confidence falters, pent-up selling pressure could be released. Such a scenario is known from other European countries, where structural change and demographics have heavily burdened real estate markets in rural regions.

Demographic Risk Hardly Priced into Mortgage Lending

The study notes that demographic risk is hardly systematically considered in today's lending decisions. Banks are guided primarily by current market prices, affordability, and loan-to-value ratios, not by long-term demographic forecasts. The authors recommend greater integration of location risks into the creditworthiness assessment.

For buyers and those refinancing, this means: Anyone who holds or acquires a property in one of the affected cantons should realistically estimate the long-term value development and not rely solely on short-term market prices when planning financing.