The tax authorities are required to carry out a revaluation of properties in the canton of Zurich and reassess the imputed rental value by the end of the year. We asked our valuation expert Jessika Baccetti what criteria the calculation is based on and what homeowners should definitely look out for.

Jessika Baccetti, what is the imputed rental value all about?

The discussion about imputed rental value has been going on for many years - in particular about its abolition. The main aim of the current adjustment is to adapt the property and imputed rental values to the current market situation from the 2025 tax period. As the owner of an owner-occupied property, you are obliged to declare the value of the property in your tax return. Until now, data last collected in 2009 has served as the basis. However, real estate prices have risen continuously since then, in some cases by over 50 percent, according to a study by Wüest und Partner.

Does this mean that homeowners will face a higher tax burden from 2025?

Yes, we can assume that. However, I consider the timing of the adjustment to be very difficult. We are currently at a critical tipping point. Over the last 10 years, real estate prices have been on a constant upward trend. Whether this trend will continue is not certain. The continuous positive market development to date has now slowed down. If a high imputed rental value is set now, it could possibly reach over 70 percent of the market rental value in the next few years. This is usually 60 to 70 percent of the market rent.

What criteria are taken into account in a revaluation?

The valuation of residential property is based on certain factors defined by the tax office. These include the market, insurance and cadastral value, the living or net usable area, the year of construction, the location and the local rent. The calculations vary again depending on whether the property is a detached house or a condominium. In the canton of Zurich, for example, the imputed rental value for a single-family home is 3.5 percent of the property tax value and 4.25 percent for an apartment. The point is, however, that in both cases the valuation is based on a standardized process. This never shows the individual value of a property.

So what advice would you give house and apartment owners?

You have to know: Not every property has experienced a 50 percent increase in value. Depending on the municipality, this can sometimes be far lower. An individual and differentiated approach is therefore appropriate. After receiving the new tax assessment, it is worth checking the key figures used by the respective authorities to determine the amount carefully and consulting with the tax office. In case of doubt, there may be incorrect or outdated data that suggests an objection to the relevant tax office. In such cases, the opinion of an independent and certified expert can also help. Their expertise can help to correctly assess the individual value of the property and thus the imputed rental value - in order to save taxes in the long term.