Mortgage choice behavior of private households in a dynamic market environment : empirical evidence for Switzerland

This paper investigates the choice of the mortgage provider of homeowners in Switzerland. Given that banks are one of several mortgage providers and due to digitalization mortgage supply has significantly changed a lot over the last year, Switzerland presents an interesting subject for this study. Our results are based on a large-scale and unique online survey with 1’130respondents from the German- and French-speaking part of Switzerland. We use a regression framework to analyze the mortgage provider choice of private households in Switzerland as a function of accommodation-specific, geographic and household-specific characteristics, such as including household income and wealth, their risk exposure and financial literacy in addition to the commonly included sociodemographic information, as well as institutional and market-specific characteristics. The results provide new insights about the preferences of households with respect to the different mortgage providers as a function of household-specific, institutional and market-specific characteristics.