An epidemic was not enough to stem rising property prices in Sweden last year. Here is what some experts say about property prices.
What kept property prices high in Sweden in 2020?
You think of a disaster that pushed unemployment to a 23-year high. In this crisis half, a million people lost their jobs, putting property prices under pressure.
But the property market is booming in 2020 in Sweden.
The property industry’s price reporting service, Svensk Mäklarstatistik stated that;
The total sales value of all flats and houses in Sweden increased by 14% in 2020 to 510 billion Swedish kronor (approximately $ 60.8 billion).
According to Andreas Wallström, head of forecasting at Swedbank;
“We saw quite significant increases. In most countries, we saw an unexpectedly flexible market, not just in Sweden.”
He promoted consumer belief that mortgage rates were about to fall, which, according to the survey, spread widely throughout the year.
As far as about unemployment concern, he further said that;
“The property market has been spared because those who lost a large number of jobs were not the ones who usually buy houses.”
“There has been a lot of debate about whether this disaster and rising unemployment will weigh on prices. However, generally, in my opinion, this is not important. The people who become unemployed are the ones who do not have a strong foothold in the market and have difficulty in getting a loan.”
Eric Olson, the chief information officer of the estate agents, agreed with John Nordenfelt.
“At the same time, others are encouraged to keep interest rates low in the future. Due to this, they feel secure and relaxed, paying a high price for a property.”
The government’s April 14 decision to suspend mortgage payments has also helped push up prices.
What sorts of properties saw the most significant rises?
Swedish estate agents speak of an ‘epidemic’, which means that the price of large houses and indigenous cabins has risen far more than flats’ price.
An increase in domestic work has meant that people have started to appreciate having more extra room for less time to travel to their workplace. However, the epidemic caused travel hurdles, which led to a rush to buy routes.
In 2020, apartments (bostadsrätter) increased by 7%, and the prices of fritidshus or ‘country cabins’ increased by 12%, while the price of separate houses increased by 13%.
In 2020, about 57,000 separate homes were sold, a thousand more than the previous year. During the year, a record 120,000 flats were sold.
Will rising prices continue into 2021?
Most estate agents and predictors are confident that prices will also be the same in 2021. Some experts believe they will be slower.
However, Hans Flink, from Svensk mäklarstatistik, stated that they don’t think they will rise. According to him, as soon as the pandemic situation will be controlled, they can see the fall in the high prices.