I think this will be temporary:
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Last 20 years (especially last 10 years) were quite unusual compared to the rest of the century. But I obviously donât have a glass ball and wouldnât bet on how the next decades will look.
Compare with US long-term:
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again a reality check on whatâs going on around us
Czech base rate: 7.00% (used to be 0.25% until Nov 2020)
Poland base rate 6.00% (used to be 0.10% until Oct 2021)
Hungary base rate 9.75% (used to be 0.60% until June 2021)
USA base rate 1.5% (used to be 0.00% until March 2022)
There is really only one way this could goâŠ
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Not sure what you mean. Why did you pick exactly those 4 countries?
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cause I canât pick the ECB as they are still silent. 
Eastern-EU is already f*cked, Southern-EU is protected by the Eurozone, I shouldâve maybe added Turkey for contrast 
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20years turned out to be not even 1yr
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Perfect example on how fast things can change lol.
SARON may save you money long term, because with fixed rate you buy certainty. For some reason, banks in Poland didnât even offer fix rate until recently, and even now you can only get it for 5 years. I think fixing the interest rate under 1% for 15 years was a great deal, because how much lower can SARON get? What is the savings potential if you go with it? Now this option is gone and I wonder how long it will take until itâs again on the table. Personally, I wouldnât take a bet worth 1 million CHF, on the future level of the interest rate.
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Well if I bought the apartment 1 year ago and had to chose between 0.50% Saron and 1.00%, I would have gone with Saron. On a 700k mortgage thatâs still a 3.5k/year difference.
Sidenote: For every increase of Saron by 1%, our interest increases by 7k/year. After taxes itâs only CHF 220 per month per person. So even a Saron rate of 2% wouldnât kill me.
and soon you would be very unhappy with it.
Why? I wonât try to time the market and assume I know the future interest rates.
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Just released new CPI: 9.1%
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Itâs not about a bet âif you know the interest rates in the futureâ, but with one you buy certainty that you can pay down the full amorization by the time the 10yr runs out, with the other, you donât. And most probably itâs your own home, which is (warning: rich dad poor dad quote coming) not an investment, but a liability.
Future interest rates can only go one way from here, really.
If the ECB raises rates, soon the SNB will be out of negative territory as well, which WILL raise SARON for the medium term as well.
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Nobody does this in CH, AFAIK.
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Like I said: I look at it long-term. Iâll probably own RE till my death in ~50-60 years. Over that time Iâm almost garantueed to pay the least interest with Saron. Higher risk, higher reward.
I expect SNB to rise their interest rate to 0.75% in the next 6-9 months. So CHF 700 per month in interest for us. Any further increase by 0.50% of the SNB will increase our interest by CHF 292 before taxes and CHF 218 after taxes.
Iâll be happy if SNB stays below 2.00% longterm.
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Sorry I didnât put it properly.
Full amortization I mean 15% of purchase price (down to 65%) then you just let it tick forever.
This sounds more like a âTWTR betâ, compare to the usual âplay safe VTâ move
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I would never like to risk insolvency. Letâs consider a case like this:
You buy a house for 1â500k. 300k is your own capital and 1â200k is the loan. Current interest rate is 1%. So you pay 1k per month or 12k per year of interest.
Your Tragbarkeit is calculated at 5%, so that means 60k plus 10k maintenance, thatâs 70k. Multiply that by x3, so you and your partner are earning together at least 210k.
Now interest rates do go up to 5%, you lose your job, you canât afford to keep paying 60k per year. So you want to sell the house, but the max offer is 1â000k. I guess in Switzerland you can just hand in the keys to your flat and walk away, right? Or is it not that simple?
I guess what also could save you in such a case is inflation. If prices go up, and you donât lose your job, your salary might also go up, so you might afford the interest after all. And after things have settled down, the nominal price of the flat will probably also be higher.
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And how is a fixed-rate mortgage protecting you from all that? Eventually it runs out, then?
Me personally I donât know any high earners that donât go with Saron.
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There is no real answer because we need to wait 10+ years to see how it will play out, then the calculation will be easy.
I just see at the moment a stagflation scenario, but also this one is a bet.
You are right, after 10 years of fixed rate, you need to take another decision based on the possible future scenarios, and it wonât be easy.
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