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Because of a lack of supply. If there had been more properties available, prices wouldn’t have developed in the same way. The availability of rented accommodation is increasing, that’s for sure. The prices at the higher-end of rented accommodation are under pressure and not only in peripheral regions, but also here (in the Zurich region).

Why is supply short?

There’s no land and there’s a scarcity of investment opportunities. Pension funds and all the other investment bodies are moving into the rented accommodation business, even though there’s a glut in this segment. Only very few are focusing on condominiums. The investors don’t plan to sell but count on long-term rental income.

Are you able to profit from this development?

High prices aren’t a good thing for us. One would have thought that real estate agents are interested in high prices. But in Zurich we’re glad to get between 2 and 3 percent of a deal, while in the Ticino and French-speaking region we may get between 3 and 4 percent. Abroad, you can earn as much as 8 percent.

Why so much less here?

Because the industry cannibalized itself. And precisely because I’m not interested in a high price. What good are 2 to 3 percent of 4 million if I can’t sell? I prefer several offers for 3 million. But the seller wants the highest price possible and demands us to get it for him.

«We want as many transactions as possible, not the highest price»

That’s our problem. There is no other job where you get so strongly diverging interests of two clients. The seller wants the highest possible price as soon as possible. The buyer wants a low price and takes a lot of time looking around. As agents, we want as many transactions as possible and not the highest price. I can only live of volumes. Big volumes and big prices would be like Christmas for us.

Are there enough potential buyers in the high-end of the market?

At the start, you may have ten interested parties. But the numbers dwindle quickly, with husband and wife having to agree, the price and location to be right for instance. For a good property in a top location you will still get two to three serious bidders.

Have houses become bigger on average?

In general yes. We keep talking about dense building, but it still doesn't happen. I’m a great fan of dense building in cities.

What keeps us from building 100 meters high?

It doesn’t have to be 100 meters, 5 to 7 floors would do. It would keep for 100 years. But there is no political will for that.

Is the simply people’s perception of how a city should look like?

Exactly. Building up would also make sense from an ecological and traffic point of view. We should build where people want to live.

What’s your prediction for the real estate market?

I have no crystal ball. I see that the economic scientists have no such crystal ball either. Even I as a property expert have fixed-rate mortgages. Like a hairdresser with a bad haircut. I don’t believe anymore that rates will rise in the medium- to long-term. That’s why I don’t believe in a bubble that is about to burst.

«The development in the apartment building segment is crazy»

At least not in the segment of owner-occupied apartments. The development in the apartment building segment is crazy. Anything is being paid, like crazy, driven by the investment emergency. Soon, anybody with some money will be forced to pay negative interest.

If you compare with the 2 percent gross that you get for real estate, that’s a plus of 2.75 percent. And brick remains brick.

So there’s a bubble in that segment?

For those who buy and then keep in their portfolio, i.e. the pension funds – I can’t see a problem. The private buyers – doctors, bankers, private investment funds – if we get a change in the interest rate environment, a re-evaluation of properties and an injection of funds – there you might have a bubble that will burst.

Gerhard Walde and his wife Marianne founded Walde & Partner in 1985. They have sold more than 6,000 properties for more than 10 billion Swiss francs ($10 billion). The family-owned business employs 50 members of staff in Zurich, Zollikon, Uster, Thalwil, Lucerne and Baden.