Property prices rise in Sweden despite interest rate hikes
In March, prices on houses and apartments went up, and prices have essentially remained stable since the beginning of the year despite ever-increasing mortgage rates.
The last month saw prices on apartments rise especially, with apartment prices in Gothenburg going up by three percent in March compared with the previous month, according to new data from estate agent organisation Svensk Mäklarstatistik.
In Stockholm prices went up by two percent, and prices went up by the same amount on a nationwide level. Apartment prices have increased since the turn of the year, despite the central bank continuing to raise interest rates and warnings of further rate rises this summer.
Most commentators are surprised by the rise in prices.
"Most financial indicators are pointing in the wrong direction, but it still seems like things have turned a corner on the property market," Svensk Mäklarstatistik's head analyst Per-Arne Sandegren told TT newswire.
Sandegren explained that this could be due to the volume of properties on offer dropping substantially, which leads to a natural build-up of people who need to move house.
In the first quarter of 2023, 27 percent fewer apartments and 19 percent fewer houses were sold compared to the same period last year. Month by month, statistics have shown that property prices have stopped dropping and have even started to increase again.
"Maybe a lot of people think now is a good time to buy," Sandegren said.
House prices also rose slightly in March: one percent across the country, with no change since the beginning of the year when compared to the previous three-month period.
From a long-term perspective, however, property prices have still seen a relatively large drop of 11 percent on apartments and 13 percent on houses. Many economists believe that prices could drop even further, perhaps even as much as 20 percent lower than the peak a year ago.
Sandegren said the situation was difficult to assess, adding that it is hard to know whether the market has reached a new balance or not.
He added that the number of properties on sale usually increases in late spring, which can affect prices.
New rate rises in the summer could also function as a form of "price gauge", Sandegren said.
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The last month saw prices on apartments rise especially, with apartment prices in Gothenburg going up by three percent in March compared with the previous month, according to new data from estate agent organisation Svensk Mäklarstatistik.
In Stockholm prices went up by two percent, and prices went up by the same amount on a nationwide level. Apartment prices have increased since the turn of the year, despite the central bank continuing to raise interest rates and warnings of further rate rises this summer.
Most commentators are surprised by the rise in prices.
"Most financial indicators are pointing in the wrong direction, but it still seems like things have turned a corner on the property market," Svensk Mäklarstatistik's head analyst Per-Arne Sandegren told TT newswire.
Sandegren explained that this could be due to the volume of properties on offer dropping substantially, which leads to a natural build-up of people who need to move house.
In the first quarter of 2023, 27 percent fewer apartments and 19 percent fewer houses were sold compared to the same period last year. Month by month, statistics have shown that property prices have stopped dropping and have even started to increase again.
"Maybe a lot of people think now is a good time to buy," Sandegren said.
House prices also rose slightly in March: one percent across the country, with no change since the beginning of the year when compared to the previous three-month period.
From a long-term perspective, however, property prices have still seen a relatively large drop of 11 percent on apartments and 13 percent on houses. Many economists believe that prices could drop even further, perhaps even as much as 20 percent lower than the peak a year ago.
Sandegren said the situation was difficult to assess, adding that it is hard to know whether the market has reached a new balance or not.
He added that the number of properties on sale usually increases in late spring, which can affect prices.
New rate rises in the summer could also function as a form of "price gauge", Sandegren said.
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