Indeed, and I appreciate the nuance of the topic (and your points). However, millenials owning RE are way less likely to turn up at the ballot box and vote. With the pensioners however, thats almost a given, so they have way more of a outsized hand in influencing a vote.
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A small proportion of the overall population but a big proportion at the voting booth. That may sway the results. Lets see.
Also, I see the initial ads on this topic on TV/SM, etc., and they almost exclusively focus on the “unfairness” aspect of the EM. Simple, yet slightly sneaky messaging to bypass the hidden nuances.
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I wondered if this is seen as a gift to the boomers/pensioners whether everyone else will vote it down.
Are you sure? There’s an easy solution to that. Just go and cast your vote, whatever it may be. Well, technically I normally don’t show up and vote by letter, but that’s easy enough. 
I miss quite a few votings for not being physically present in Switzerland. There is no solution for this, I don’t want to register as living out-of-Switzerland.
Actually I just moved my next travel to after 12th of September, that should be enough to get the documents. I own two pieces of real estate but will vote “no” anyhow because of the debt interest situation.
Ok, that’s a bit special. But you do get the voting material a few weeks in advance. I did live abroad, but back then didn’t bother as much, yet I’m pretty sure you could register, though.
Of course, and I guess that’s Sirob’s point, you need to care enough. My point is that I for example do 
Also, I see the initial ads on this topic on TV/SM, etc., and they almost exclusively focus on the “unfairness” aspect of the EM. Simple, yet slightly sneaky messaging to bypass the hidden nuances.
There’s also quite a bit of noise about improving ownership accessibility, an orthogonal topic in practice, which I find disingenuous.
I am not sure why people here think it will not pass. As someone else reported, polls are strongly in favour so far, and technical arguments almost never work against emotional arguments like “fairness”.
Even if I am against it, I am planning on it passing.
I understand the debt argument, but as I said before I believe there were other ways to address it. I am also not certain how big of an impact it will actually have.
At the end of the day, interest rates are low enough that the loss of the ~33% discount (very condition specific, but my guess at the average) is still not enough to tip the balance.
Until they aren‘t anymore.
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Well, until your brand new apartment is no longer brand new and the maintenance costs start skyrocketing…
I owned one such apartment from 2015 (first owner/occupier) to 2022. The spring storms got so violent since the building was designed in 2012 that in 2021 multiple apartments got flooded. Then after I left there has been more flooding and now they have spent a small fortune to change and redo the whole gutter system of the building, which has now just turned 10 years old
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But that’s already the case. The new law is just changing a multiplier for the pay back vs invest balance.
Also, if interest rates increase, then you can reduce the mortgage with the money you’ve been investing elsewhere. Of course, you need to hope that your investments have not tanked at the same time, but again the problem already exists and yet people are still carrying huge debts.
And if you haven’t invested, then I don’t know. I find it hard to predict the behaviour of irrational people. Maybe the “you will save in taxes” argument from unscrupulous brokers will no longer work and the change will actually be effective. Maybe they will simply find other ways to convince people to keep the debts high against their best interests.
Skeptical about this: the only ones winning would be people having amortised 100% (or almost 100%) of their house. I personally feel that should amount to 1% of the pensioners.
Many people would have taken advantage of the house value increase to remortgage and free funds for further investments. For sure that’s what I’m planning to do when my current mortgage finishes next year
I strongly doubt it… people in this forum are not good representatives of the Swiss population
Will you reduce your mortgage in case Inputed Rent Income is removed?
- Yes
- No
- See results
0
voters
I have had a fair share of swiss and swiss resident colleagues and friends, you would be surprised how many of them would play with remortgaging while at the same time be totally “ignorant” about investments at large
I could pay back all my debt at any moment. I wont, not only because of tax.
We need inflation for our society to survive. We cannot lower salaries, even if we needed to. There are other prices that cannot be lowered. The only possibility price-finding and therefor our economy works is inflation.
So debt is a must for me, even I don’t need the money. You can borrow always plenty of money when you don’t need it. Money is probably the only good in the world with a state guaranty to lose value.
I would hate to pay tax on the interest I pay and therefor I will vote “no”. But it seems the vote is already lost…
I’m on a fixed rate so I will not be able to immediately reduce.
Assuming that interest deductions are limited, it would tilt towards paying off.
But it depends on various factors.
I have one basic question. People always say we should inflate our way out of debt. What does it mean?
Aren’t we also paying interest on debt which is very similar to inflation ? So on total cost perspective, the (debt + total interest over debt tenure) should be a large number versus original debt.
As always it depends. I suppose “inflate our way out of debt” the government is meant by “we”.
If the interest is higher than inflation it is not possible to “inflate our way out of debt”, except you invest the debt in a good that provides more return than inflation. That is what I do and what the government should do… and sometimes does.
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We will see first hand what this means soon.
Basically, it will mean that inflation will be allowed to erode the debt. Interest rates will be artificially kept low so that debts don’t keep up with inflation and so the value of the debt gets eroded away.
You’ll see Fed pressured to cut interest rates in spite of inflation running hot, maybe also using curve control to bring down yields also on the long end. Fed will be bullied into submission or a ‘sympathetic’ new Fed Chief put in place.
How to stop people dumping your bonds? Financial repression. You’ll force your domestic institutions to buy them. And as Trump has already indicated an as Miren has suggested, you force your allies to convert the debt into 100 year zero-coupon bonds.
Yeah. There’s a reason I’ve dropped bonds and have been shifting into gold and real assets. I’ll soon be moving gold out of the US too (currently most are US instruments).
Honestly, I see an inflationary boom as the optimistic scenario. There’s also the risk of stagflation. However, with fiscal policy running hot, if monetary policy is also run loose we might see the biggest stock market boom of all time (probably followed by the biggest bust of all time).
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Japan
- government bonds (JGB):
- 1 yr: 0.66%
- 5 yr: 1.12%
- 20 yr: 2.64%
- inflation rate (CPI): around 3%
Turkey
- 1 yr government bonds: 58%
- inflation rate: 60%
Switzerland:
- SNB nominal interest rate: 0%
- inflation rate: 1.2%
I’m neither a data scientist nor an economist,[#] so take these numbers with a grain of salt.
Also, despite everyone claiming the US is inflating their way out of debt, US real rates still seem positive … but I’m almost certain that my claims will be debunked within a couple of replies to this post.
# Not sure which occupation term is more insulting … I’ll go with “economist”.
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