Guide

Reference rate 1.25 %: what does it mean for your rent?

Updated 23.09.2026 · Current reference rate 1.25 %

The Swiss mortgage reference rate has been 1.25 % since 2 September 2025 and was confirmed on 1 September 2026. If your rent was last set on a higher rate (1.50 % or more), you can request a reduction: 2.91 % per quarter point in theory, minus any inflation and cost increases your landlord is allowed to offset.

Where the reference rate stands

The mortgage reference rate is published every quarter by the Federal Office for Housing (BWO). It is the volume-weighted average interest rate on Swiss mortgages, rounded to the nearest quarter percent (Art. 12a VMWG). For rents it is the key figure: when it falls, tenants whose rent was set on a higher rate may request a reduction; when it rises, landlords may increase the rent.

The rate currently stands at 1.25 %. It was lowered from 1.50 % to 1.25 % with effect from 2 September 2025 and has been confirmed unchanged at every announcement since, most recently on 1 September 2026.

The full history since 2008 is on our page reference rate and CPI.

Who can claim a reduction

What matters is not the rate on the day you moved in, but the rate on which your rent was last set. That is usually stated in the lease ("rent basis: reference rate 1.75 %") or in the last rent adjustment notice. You may be entitled to a reduction if:

• your rent is based on 1.50 % or higher, for example because it was set between June 2023 and August 2025 (1.50 % or 1.75 %), or before March 2020;
• you have an ordinary residential lease – not a genuine indexed lease or graduated lease, and not subsidised housing or a luxury property (see indexed and graduated rents);
• the landlord has not already passed on the cut voluntarily.

If your lease states no reference rate, the rate in force when the rent was last set is used in practice. Our calculator can look it up for you from the month.

Reduction table by basis rate

For reference rates below 5 %, each quarter point corresponds to 3 % of rent (Art. 13 para. 1 VMWG). For a cut, this results in the pass-through rates published by the BWO: 2.91 % for 0.25 points, 5.66 % for 0.50 points, and so on. The percentages are not simply added up.

These are maximum values. Rents set long ago usually face larger offsets for inflation and general costs, so the actual reduction is lower.

Worked example: CHF 2,000 rent

Suppose your net rent of CHF 2,000 was last set in December 2023 on a reference rate of 1.75 %.

New net rent: CHF 1,933.08. Ancillary costs are not affected; the reduction applies to the net rent only.

What the landlord may deduct

A lower reference rate does not automatically lead to the full reduction from the table. By law, landlords may offset savings against cost increases that have occurred since the rent was last set (Art. 13 para. 1 VMWG). The most common counter-claims are:

• Inflation: up to 40 % of the rise in the Swiss consumer price index (CPI/LIK) since the last rent setting (Art. 16 VMWG).
• General cost increases: higher maintenance, fees, insurance premiums etc. (Art. 12 VMWG). Many conciliation authorities accept a flat rate of 0.5 % to 1 % per year; our calculator uses the lower 0.5 %. You do not have to accept a flat rate: if the landlord wants more, they must document the actual costs.
• Reservations: if the landlord did not fully pass on an earlier increase and stated this as a reservation in CHF or percent (Art. 18 VMWG), it may be offset.

How to check these objections is explained in our guide checking landlord objections.

How to claim it

1. Check the basis: find the reference rate and the date of the last rent setting in your lease or last adjustment notice.
2. Calculate: use the calculator or the table above.
3. Write to the landlord: the request must be in writing (Art. 270a para. 2 OR); registered mail is recommended as proof. All tenants named in the lease should sign. A template is in our guide rent reduction request template.
4. Observe the deadline: the reduction applies from the next termination date with at least three months' notice (Art. 266c OR). The request must arrive before the notice period begins – see termination dates by canton.
5. Wait 30 days: the landlord must respond within 30 days. If they refuse or do not respond, you can apply to the conciliation authority within another 30 days – free of charge (what to do if the landlord refuses).

Next announcement

The BWO publishes the reference rate quarterly, usually on the first working day of March, June, September and December. The next announcement is on 1 December 2026. Should the rate fall to 1.00 %, tenants whose rent is based on 1.25 % would also become eligible; those already on a higher basis could claim more. We update this page on the day of the announcement.

Frequently asked questions

Sources

• Federal Office for Housing (BWO): mortgage reference rate
• Art. 12a, 13 and 16 VMWG (SR 221.213.11)
• Art. 266c and 270a Swiss Code of Obligations (SR 220)
• Swiss tenants' association: rent reduction

Related guides

• Rent reduction request (Herabsetzungsbegehren): template & sampleSample letter for a Swiss rent reduction request under Art. 270a CO: content, deadline, registered mail and what happens after the landlord replies.
• Inflation, cost increases and more: checking your landlord's objectionsYour landlord rejects a rent cut citing inflation, costs or yield? How to check each objection under Swiss law, with the legal limits that apply.
• Landlord refuses your rent reduction – what to do nextRefused, partly accepted or no reply: within 30 days you can apply to the conciliation authority – free of charge and with protection from eviction.
• Indexed and graduated rent: does the reference rate cut apply?With a valid indexed or graduated lease the Swiss reference rate does not count. How to recognise your lease type and what applies after the fixed term.

This guide explains the general legal position under Swiss tenancy law. It is not legal advice for your individual case. For disputes, contact your cantonal conciliation authority or a tenants' association.