Results of the vote of 28 September 2025
On September 28, 2025, the Swiss citizens and the cantons voted on two federal reforms. One of them directly concerns the real estate sector. In this article, we will examine the result of this vote in detail.
- Federal Act on Electronic Identity (e-ID): approved by 50.39% of voters.
- Real-estate tax reform: including the abolition of the imputed rental value and the possibility for the cantons to introduce a tax on second homes, approved by 57.73% of voters.
These two components are legally linked: the abolition of the imputed rental value is conditional on the introduction of a new cantonal tax on second homes. The aim is to ensure a fair decision and to limit tax losses for the cantons and the Confederation.
What are the next steps?
The abolition of the imputed rental value and the introduction of a tax on second homes will come into force by 2028, giving property owners and cantons time to adapt. The main planned measures are as follows:
- First-time buyers: They will be able to continue deducting mortgage interest during a transitional period of ten years.
- Limited deductions: Certain deductions, in particular for renovation or energy-efficiency works, will be restricted for property owners.
- Cantonal tax compensation: Each canton will have the possibility to introduce a tax on second homes in order to offset the tax losses caused by the abolition of the imputed rental value.
Before – after: macroeconomic view
Before the vote: The imputed rental value encouraged property owners to maintain a high level of debt, since mortgage interest was tax-deductible. This mechanism partly explains why Switzerland has one of the highest household debt ratios.
After the vote: The abolition of the imputed rental value should simplify the tax system and reduce the incentive to incur debt. However, several side effects are to be anticipated:
- Ending the deductibility of renovation expenses may lead to fewer maintenance and modernization works, which could weigh on the construction sector.
- This decline in activity could, in the long term, result in job losses in companies specialized in renovation. Consequence: a higher unemployment rate and a decrease in Swiss GDP.
- At the same time, the increased tax attractiveness of property ownership could stimulate demand for home purchases, driving up real-estate prices.
Winners and losers of the vote
At first glance, the reform seems to favour property owners and disadvantage tenants. In reality, the situation is more nuanced.
Winners:
- Owners with little or no debt: Often older households who have already paid off their mortgage and own properties requiring little or no renovation. They fully benefit from the abolition of the imputed rental value and are scarcely affected by the end of tax deductions.
- Buyers of new or already renovated properties: Owners of new or recently renovated properties will have little to no renovation work to carry out in the short term.
Losers:
- Highly indebted owners: Typically young families or recent buyers will lose the possibility to deduct a large portion of their mortgage interest.
- Owners of old or renovation-prone properties: Those planning major investments (energy upgrades, modernization) will face higher tax burdens.
- Owners of second homes: They may be the most affected, as cantons will be able to introduce a new specific tax to offset the loss of the imputed rental value.
Indirect effects on tenants: in cantons where homeownership is high (for example Valais), the abolition of the imputed rental value could cause greater revenue losses than the income generated by the second-home tax. To balance their budgets, cantons and municipalities could:
- Increase certain taxes or fees (e.g. income tax, local levies).
- Reduce certain public services (social housing, energy subsidies, infrastructure).
Impact on the renovation sector
The tax reform will probably affect the renovation market, in particular energy-related works:
- Decrease in the attractiveness of energy renovations and non-urgent renovations, as they will no longer be tax-deductible.
- Risk of job losses and an increase in unemployment in construction and renovation companies, due to lower medium-term demand.
Before the final entry into force (by 2028), a period of strong demand can be expected. Many owners could bring forward their renovations to benefit from the tax deductions still available. This “rush to construction sites” could temporarily stimulate employment and the use of resources in the building sector.
Once the deductions are abolished, the sector could experience a decline in demand: fewer orders, decrease in turnover and possible economic slowdown in the branch.
To limit the risks, companies could:
- Reposition themselves on ecological added value (energy savings, sustainability, comfort).
- Highlight the non-tax advantages of renovation: long-term energy savings, enhancement of the property, increased comfort.
- Build up financial reserves during the phase of strong demand to cushion a possible downturn after 2028.
Ecological consequences
The abolition of the imputed rental value could reduce the attractiveness of energy renovations. The president of the Swiss Green Party, Lisa Mazzone, voiced her concerns: according to her, this reform could slow down climate protection by reducing financial incentives to improve the energy efficiency of buildings.
Moreover, climate change is already having direct impacts on the real-estate sector:
- More frequent heatwaves accelerate the deterioration of façades and roofs, increasing the need for renovation.
- Flooding and heavy rainfall weaken walls and require better insulation as well as reinforced drainage systems.
For real-estate professionals, these developments mean anticipating higher costs and integrating building climate resilience into every investment or management strategy.
Abolition of the imputed rental value: potential consequences for the real-estate market
- Increase in demand for new or already renovated housing: The abolition of tax deductions for renovations could lead many buyers to favour newer or fully renovated properties. Probable consequence: rising prices in this segment, particularly in urban and suburban areas.
- Possible decrease in renovation costs: Conversely, renovation demand could decline, creating downward pressure on renovation prices. This could make purchasing an older property to renovate more attractive, especially if owners negotiate lower rates.
- Overall increase in demand for home ownership: The abolition of the imputed rental value reduces property owners’ tax burden. New population segments (young families, seniors) might be encouraged to buy, thereby stimulating demand and prices.
- Partial refocus on renting: If purchase prices rise too much, some households may postpone their plans and remain tenants. This would continue the current trend: buying homes in peripheral or rural areas and renting in cities, where prices remain high.
Tax on second homes: potentially more adverse consequences
The introduction of a cantonal tax on second homes could have several negative effects on the real-estate market:
- Slowdown in investment in second homes: Buyers, particularly foreign investors, might think twice before acquiring a second property, which would slow down demand in this real-estate segment.
- Incentive to use or rent out: Greater tax pressure on unoccupied or seldom-used dwellings could push owners to rent out or sell their property in order to reduce their tax burden.
- Shift in demand toward primary residences: Households might prefer to invest in their main home rather than in a second residence that has become less fiscally advantageous.
Advice that could be given to owners and future owners
- Anticipate renovations: Carrying out renovation or energy-efficiency works before the reform enters into force (by 2028) still allows you to benefit from the current tax deductions.
- Favour already renovated properties or renovate quickly after purchase: Buying a new or already modernised home reduces the risk of non-deductible expenses. Otherwise, plan renovations promptly before the end of the transitional period.
- Postpone investments in a second home: The possible introduction of a specific cantonal tax makes this type of purchase currently more uncertain and potentially less profitable.
- Closely monitor market developments: The full effects of the reform (prices, cantonal taxation, demand) remain uncertain. It is advisable to follow the evolution of mortgage rates, cantonal policies and price trends before making major decisions.
In summary: the key points
Abolition of the imputed rental value
- Could stimulate access to home ownership, with interest deduction for first-time buyers for ten years.
- Could reduce renovations due to the absence of tax deductions.
- Could encourage debt reduction.
New tax on second homes
- Could decrease the attractiveness of these properties and slow down foreign investment.
- Could increase the tax burden on little-used dwellings, prompting sales or rentals.
- Could shift demand toward primary residences or renting.