Every three months the rate of interest used to set Swiss rents is reviewed. If it goes down some renters have the right to request a decrease in rent. This time it remained at 1.50%.
The last time it dropped was 2 June 2017 when it fell to 1.5%, its lowest level since 2008.
The rate is based on the average Swiss mortgage rate over three months. This rate is then rounded to the nearest 0.25%. On 30 September 2018 that rate was 1.47%, which rounds to 1.5%. The underlying mortgage rate has declined every quarter since 30 September 2008 when it was 3.45%. On 30 June 2018 it was 1.49%.
In general if your rental contract links your rent to mortgage interest rates then you can demand a decrease in rent when this reference rate declines. The Swiss Association of Tenants, Romande branch, provides useful information on when and how to go about making a demand. Their website (in French) can be found at www.asloca.ch.
Swiss rent rises have outstripped inflation. According to the Federal Statistical Office, rents have risen by 17.6%1 since 2005, representing an average annual rise of 1.25%. Over the same period, Swiss inflation has been 3.5%1, an average of around 0.27% per annum. Fortunately, average salaries, which have risen by 15.3%, an average of 1.1% per annum2, have almost kept up with rent increases.
Current and historical reference interest rates are presented on the Office fédéral du logement (OFL) website.