Expats pay more than Swiss for same rental housing

Foreigners spend more than Swiss citizens to rent the same lodgings in Geneva and Zurich, according to a new study from HEG, the Geneva school of business administration. Fear of outsiders and different education levels are major factors in the discrimination, says the study that notes laws of supply and demand are also a factor, but landlords deny such a two-tier pricing policy exists. With accommodation in major Swiss cities – especially in Geneva – already scarce and expensive, a new study, carried out by business school HEG claims that landlords are giving foreigners a raw deal.
The study, called "Do foreigners pay Higher Rents for the Same Quality Housing in Geneva and Zurich?"  reveals that for lodgings with the same characteristics, non-Swiss pay 2.3 percent more than locals. In Zurich, the discrepancy is 2.6 percent on average.
Andrea Baranzini, professor at Geneva-based HEG school, headed the study. Baranzini told Swisster about how his team reached their conclusions, while admitting that the issue was as complex as wage discrimination.
“We have a law in Switzerland that you cannot discriminate against women etcetera, but this is difficult to demonstrate because there are so many factors to take into account," he said. "This discrimination in the rental market is exactly the same.” 
Baranzini said the study used the Hedonic method [developed in the United States in the 1950s], which provides a way of comparing apartments and rents based on such factors as floor space, number of rooms, location, noise, pollution and structural characteristics.
"We then introduced the social characteristics of individuals renting the places – their education and so on – taken from the Swiss population cencus in 2000,” Baranzini said.
Tenants with a modest education (and supposedly fewer negotiation skills) are required to pay up to 5.2 percent more rent than a Swiss would for the same apartment in Geneva, the study concluded. According to a census, an estimated 46 percent of foreigners in Switzerland only completed basic schooling, compared to 23 percent of Swiss.
“Statistically speaking, there are no differences or discrimination between different types of foreigners, such as between Germans or Africans, what really matters is the level of education, probably also the level of income, but we don’t have that data,” Baranzini said.
Other factors behind the rental discrepancy include owner's fear of non-payment and reluctance to let to larger families, more of which tend to have origins outside the country, the study says.
Landlords, however, are questioning the validity of the findings. “We don’t share their conclusions at all," Enrique Ortiz, administrator at the Geneva-based Regie de la Cité told Swisster. "I don’t know how they can prove what they are saying. Rents are fixed in advance. The notion that we have one price for an Italian at say, 1,100 francs per month, and one for a Swiss at a 1,000 is absurd.” 
The study, published in the Revue suisse d’économie et de statistiques, was funded by the Swiss National Science Foundation. It took around 18 months to complete. Over 42,000 comparisons were carried out in Geneva and more than 26,000 in Zurich.
Foreigners working for international organizations were not included in the research because in many cases individual accommodation arrangements are made between their employers and landlords. Non-Swiss living in housing cooperatives were also excluded from the study.
 
 
 
 

Foreigners spend more than Swiss citizens to rent the same lodgings in Geneva and Zurich, according to a new study from HEG, the Geneva school of business administration. Fear of outsiders and different education levels are major factors in the discrimination, says the study that notes laws of supply and demand are also a factor, but landlords deny such a two-tier pricing policy exists. With accommodation in major Swiss cities – especially in Geneva – already scarce and expensive, a new study, carried out by business school HEG claims that landlords are giving foreigners a raw deal.
The study, called "Do foreigners pay Higher Rents for the Same Quality Housing in Geneva and Zurich?"  reveals that for lodgings with the same characteristics, non-Swiss pay 2.3 percent more than locals. In Zurich, the discrepancy is 2.6 percent on average.
Andrea Baranzini, professor at Geneva-based HEG school, headed the study. Baranzini told Swisster about how his team reached their conclusions, while admitting that the issue was as complex as wage discrimination.
“We have a law in Switzerland that you cannot discriminate against women etcetera, but this is difficult to demonstrate because there are so many factors to take into account," he said. "This discrimination in the rental market is exactly the same.” 
Baranzini said the study used the Hedonic method [developed in the United States in the 1950s], which provides a way of comparing apartments and rents based on such factors as floor space, number of rooms, location, noise, pollution and structural characteristics.
"We then introduced the social characteristics of individuals renting the places – their education and so on – taken from the Swiss population cencus in 2000,” Baranzini said.
Tenants with a modest education (and supposedly fewer negotiation skills) are required to pay up to 5.2 percent more rent than a Swiss would for the same apartment in Geneva, the study concluded. According to a census, an estimated 46 percent of foreigners in Switzerland only completed basic schooling, compared to 23 percent of Swiss.
“Statistically speaking, there are no differences or discrimination between different types of foreigners, such as between Germans or Africans, what really matters is the level of education, probably also the level of income, but we don’t have that data,” Baranzini said.
Other factors behind the rental discrepancy include owner's fear of non-payment and reluctance to let to larger families, more of which tend to have origins outside the country, the study says.
Landlords, however, are questioning the validity of the findings. “We don’t share their conclusions at all," Enrique Ortiz, administrator at the Geneva-based Regie de la Cité told Swisster. "I don’t know how they can prove what they are saying. Rents are fixed in advance. The notion that we have one price for an Italian at say, 1,100 francs per month, and one for a Swiss at a 1,000 is absurd.” 
The study, published in the Revue suisse d’économie et de statistiques, was funded by the Swiss National Science Foundation. It took around 18 months to complete. Over 42,000 comparisons were carried out in Geneva and more than 26,000 in Zurich.
Foreigners working for international organizations were not included in the research because in many cases individual accommodation arrangements are made between their employers and landlords. Non-Swiss living in housing cooperatives were also excluded from the study.