Home prices are rising in Sweden, as more and more properties have been put for sale. Speculation in property is at an unprecedented high in the country, which should worry you if you’re looking to sell your property in Sweden fast.
Sweden is one of the richest countries in the world with a very stable economy. The monetary inflation in Sweden has been just 0.9% - which is as low as it gets. However, what’s hurting Sweden is not monetary inflation, but housing inflation. Property prices in have risen in double digits in Sweden since 2014, and this has spooked a lot of people.
Most experts are of the opinion that there is a housing bubble in Sweden. That the interest rates in Sweden are so low that they are negative hasn’t helped matters one bit. The Swedes don’t save money in banks; they prefer to invest in stocks, bonds and property.
Indeed, many Swedes are investing the money got from mortgage loans into stocks and bonds. The stock market boom and the housing boom in Sweden feed off each other.
The worry is that if the economy takes a turn for the worse, many Swedes will not only be forced to sell their homes to pay off mortgage loans, but also to sell stocks and bonds – which could possibly cause great harm to the national economy.
How bad is the housing situation in Sweden? It’s so bad that recent immigrants to the country are forced to sleep 10 people to a room. There’s a refugee crisis in Sweden with hundreds of thousands of asylum seekers making their way here every year. This has led to a severe shortage of toilets in Sweden, not to mention a real scarcity of accommodation.
In fact, for a few months at the start of 2016, the property market in Sweden had cooled down a bit, taking some of the pressure off both buyers and sellers. Experts had said back then that things were changing as far as the real estate market was concerned.
However, new data released by Svensk Mäklarstatistik – a Swedish agency which measures sales by real estate agents in the country has suggested that prices of properties for sale in Sweden are on the rise. This is mainly because of the new rush among Swedish home seekers to look for a new home before the onset of winter.
Per-Arne Sandegren, an analyst at Svensk Mäklarstatistik says, "After a few months of stagnation, prices are starting to move upwards again. It's particularly evident for houses, with an increase of two percent in greater Stockholm and greater Gothenburg in the past month."
Tanja Ilic, CEO of realtors Svensk Fastighetsförmedling added, "This is not a unique situation and looking at the same period last year the development was very similar and if it continues to follow last year's trend we will be seeing price increases in the future too."
The property bubble has been affecting other areas of the Swedish economy. Recently the German company Cuponation had to scratch its plans to switch its headquarters to Stockholm from Munich because its staff said they couldn’t make the move as housing was far too expensive in Stockholm.
Even a one-bedroom basement flat with no natural light whatsoever in Stockholm costs as much as £610,000! There’s no doubt that there’s a property bubble in Sweden, the question is how much longer will it last for.