How can we explain the gradual withdrawal of housing investors?

In the first five years of the 1980s, 43'000 dwellings were built on average in Switzerland. At the turn of the century, the comparable number was down to 31'000 dwellings per year. A declining trend in housing construction is clearly visible over those twenty years. The vacancy rate fell from 1.85% to 0.91% between June 1998 and June 2003. It is well below percent today in the main cities. The 2000 census shows that pension funds, the second largest group of providers, own fewer dwellings than they did at the time of the last census in 1990, despite their growing funds. Those data suggest a withdrawal by many investors from the housing market. This paper verifies whether there is indeed a smaller willingness to build and invest in rental dwellings or whether the hurdles have grown higher.