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Real estate valuation takes into account legal, economic and technical aspects, so it is necessary to know each of these sectors. You also need to have a good eye for the local market, its specificities and the main trends observed.
Mr. Vincent Clapasson, Director at Wüest Partner
What does your collaboration with Foxstone consist of?
Wüest Partner assists Foxstone in the valuation of properties that the company wishes to purchase.
We advise Foxstone on the value of the property through several elements: A study of the actual and potential income, the planning of various works, the determination of the recurring costs. But also the determination of the yield which takes into account the advantages and disadvantages of the property and its location.
What do you think are the qualities of a good property valuer?
Property valuation takes into account legal, economic and technical aspects, so you need to know each of these areas. You also need to have a good eye for the local market, its specificities and the major trends observed. This applies to construction (technical aspect), economic developments (economic aspect) and changing needs (socio-demographic aspect).
What is the outlook for the Swiss residential property market?
The residential real estate market has been very dynamic over the past two years with a very high transaction volume. It is therefore expected that properties will continue to be sought after in the coming years by both private and institutional investors.
For more than a year we have seen a decline in rental property yields, what is the reason for this trend and will it continue?
This decline in rental property yields is probably due to the fact that there are few alternatives on the stock market (shares, bonds), and to the billing of passive accounts with banking or financial institutions.
How do you see the impact of the current rise in interest rates on the value of investment properties?
In terms of the evolution of interest rates on the market for investment properties, which are mainly acquired by institutions without the need for foreign funds, the impact should be low. However, it is necessary to observe the evolution of bond yields and interest rates from financial institutions, which could once again be more attractive to investors.
What are the main risks currently facing the Swiss real estate market?
It is difficult to state the main risks that weigh on the Swiss real estate market, in my opinion, there can be several dangers specific to each property. For example, typologies or designs that are no longer in line with market demand. Excessive rental income or a poorly optimised cost structure can be blocking factors. In this last point, there is a very important theme that must be taken into account by investors: sustainability. The energy transition must be considered, to move as far as possible towards carbon neutrality (CO2 reduction). This then makes it possible to transform a risk into an opportunity.
Thank you to Mr. Vincent Clapasson, Director at Wüest Partner, for accepting to share his testimony as a Foxstone partner.
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