Swedish housing market sees more transactions amid new mortgage rules

Sweden's housing market experienced a dynamic second quarter, marked by diverging price trends for apartments and houses, alongside a notable increase in sales activity, according to new figures from Svensk Mäklarstatistik. While apartment prices nationwide dipped by 0.4% in June, house prices saw a rise.

The market has been unusually active this summer, with sales of houses exceeding those during the pandemic years of 2020, 2021, and 2022. In the first half of the year, 30,900 houses were sold, compared to 29,200 in the same period of 2022. House prices in Greater Stockholm rose by 1.4%, and in Greater Malmö by 1.1%, while Greater Gothenburg remained relatively unchanged. Overall, house prices across Sweden increased by 1.2%.

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Probably people have felt that they can afford to buy a larger apartment.

This surge in activity is partly attributed to new mortgage regulations implemented on April 1. These changes included raising the mortgage ceiling to 90% of a property's value and removing the stricter amortization requirement. Hans Flink, sales manager at Svensk Mäklarstatistik, suggests these regulations may be encouraging people to purchase larger apartments, as evidenced by a 16% increase in apartment sales nationwide compared to the previous year.

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One can imagine that the mortgage rules would benefit those who buy a one or two-bedroom apartment. We see that in Stockholm and Gothenburg at least.

Larger apartments, specifically those with four rooms or more, accounted for the most significant increase in sales volume across the country. Flink noted that in central Stockholm and Gothenburg, the sales of one and two-bedroom apartments have increased the most, potentially indicating that buyers feel they can afford more space under the new rules. However, the overall national dip in apartment prices is influenced by fewer apartment sales in central Stockholm, where the market has cooled during the summer.

Flink expects the number of apartments available in central Stockholm to increase again in August and September. Despite the slight June decline in apartment prices, the market shows resilience, with overall apartment prices rising 4.7% year-on-year. The robust performance of the housing market, particularly for houses, suggests a continued demand, possibly bolstered by the recent regulatory adjustments.

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Because Stockholm is going down, it rubs off on the national level.