User costs of housing are a major part of a household’s expenditure. I empirically investigate the heterogeneous impact of an unanticipated expansionary monetary policy on housing markets and household tenurial decision by exploiting the user cost of housing channel. Drawing on a Swiss household panel data and daily interest rate futures, I find that the less financially constrained households are 3.45 percentage points more likely to become homeowners in case of unexpected decrease of 100 basis points in 3-month CHF Libor. The households in the upper income quartile with pillar 3a savings benefit the most in case of an unanticipated negative monetary policy shock. The real user cost expenses of renting also benefits significantly by a decrease of on average 19% from an unexpected expansionary monetary policy. Single family houses do not benefit from the shocks in the monetary policy. The findings highlight the importance of apartments and multifamily housing.