Europe's news in English

COPY LINK

STOCKHOLM

Here’s what you can get from Sweden’s property market for one million

What size of property can you buy in Sweden for a million kronor ($111,800)? New estate agent figures reveal the answer, and lovers of the Swedish capital may want to look away now.

Published: 20 April 2017 10:26 CEST

Here's what you can get from Sweden's property market for one million

Space comes at a premium in central Stockholm. Photo: Tomas Oneborg/SvD/TT

According to property broker Svensk Fastighetsförmedling's numbers, in Stockholm municipality you can expect to get a bostadsrätt (the right to an apartment in a building owned by a housing cooperative) for a 14 square meter place if you cough up a million in Sweden's currency.

Move slightly further out to Solna, Danderyd, Sundbyberg and Lindingö municipalities (which are all still in Stockholm county) and the same cash will get you the right to between three and five square meters more.

Ditch the capital entirely and head west to look for a bostadsrätt in Kristinehamn, Värmland however and a million kronor can buy a whopping 227 square meters in total.

According to Kasper Isgren from Svensk Fastighetsförmedling, urbanization is the key explanation for the variation:

“The price level is linked to how many employment opportunities are available in the municipality, and how desirable it is to live in the respective city.”

READ ALSO: Where are property prices rising in Sweden?

The same rules apply for the prices of Sweden's detached houses. In Hultsfred, southern Sweden, one million kronor can buy a 211 square meter house. In desirable Lidingö, it could buy as little as 14 square meters.

And it's not just the big cities that deliver less bang for your buck. There's bad news too if you feel like living near a ski resort or in a vibrant university town.

“Space also becomes more expensive in places that have something else to offer, like the student city Lund, and the popular skiing resort Åre,” Isgren noted.

Smaller municipalities that neighbour larger hubs can also see prices hike if transport links improve. Which is great if you get there early, but not so good if you're slow off the mark.

INTERVIEW: 'Most foreigners in Sweden don't know they can get back excess rent'

More and more of the people asking the Swedish Tenants’ Association, Hyresgästföreningen in Swedish, for help with excess rent are foreigners, Sjölin told The Local in an interview.

“The problem is that if you’re coming from another country, and you’re subletting an apartment, you’re probably not familiar with the rules in Sweden, because in other countries, it might be okay to overcharge your tenants.”

He said that clients from India in particular seeking help from the association were now “very common”.

“Many people come here to work as engineers in the IT sector and then have to rent somewhere,” he said, adding that as a group Indians appeared to be “very aware of their rights.”

Sweden’s rental sector is heavily regulated, with first hand contracts negotiated between landlords and the Tenants’ Association, and the rent that can be charged for second-hand contracts limited to only a small fraction above what the first-hand renter pays.

“You’re not allowed to make any profit subletting an apartment in Sweden,” Sjölin explains. “You can only charge the subletting tenant the same rent as you [the first-hand tenant] are paying to your landlord, and then you can add the costs for internet and electricity, and perhaps a parking lot, if that is included.”

Tenants’ Association lawyer Roland Sjölin. Photo: supplied.

You can also add a påslag or “markup”, if you are renting out the apartment fully furnished, but this cannot exceed more than 15 percent of the rent.

That doesn’t mean that most landlords follow the law. The competition for rental apartments, especially in Stockholm, is so intense, that unscrupulous sublet landlords often try to get away with charging well over the legal amount, charging what is known in Sweden as ockerhyra, or “excess rent” and hoping that their tenants are too desperate to complain.

What many foreigners do not realise is that even after the rental period is over, they can still get back any excess rent they have paid by applying to the Rental Board or Hyresnämnden, which functions like a court judging rental disputes.

“If you have the evidence then it’s fairly easy,” Sjölin said. “I get a new case every second week on repayment of unfair rent, and I think that I win most of them.”

“Nowadays, you can get paid back excess rent up to 24 months back in time, so people tend to get more money,” he added. “In some cases, they can get 200,000 kronor. In other cases, perhaps it’s only 30,000 kronor or 60,000 kronor. It depends on how long you have rented the apartment, and how excessive the rent you’ve been paying has been.”

The first step is to establish what would have been a fair rent, either by asking your landlord what they themselves pay directly or by checking with the Tenants’ Association.

“Because we negotiate most rents in Sweden, we normally know what the firsthand rent is,” Sjölin explained.

Then you need to collect together your evidence.

“It’s a good thing to have a written contract and also papers from your bank showing that you paid rent every month, and perhaps photographs of the apartment, so the rental board can get an idea of the apartment you were renting and what would be a fair rent, and also the termination for the contract so you can show the court how long you’ve been living in the apartment.”

But Sjölin underlined that since Sweden has free burden of evidence, none of this is essential.

“Even if you’ve been paying in cash, if you have witnesses who can testify what you were paying each month, you still have a chance of getting your money back. It’s a bit more tricky, but I’ve won two cases like that this year.”

People in Sweden, he explained, tend to wait until the rental period is over before seeking to get paid back excess rent rather than challenging their landlord while they are still living in the apartment.

“You don’t have any legal protection for your home for the first two years, so if you bring the matter up with the person you’re renting the apartment from you risk losing your contract and having to move out, so most people wait until they’re supposed to move anyway,” he said.

If you apply to the rental board for a refund close to the day you move out, you can then make your landlord pay back all excess rent paid in the 24 months leading up to the date you contacted the rental board.

If you are a member of the Tenants’ Association, you can contact them and ask for help with your application, but there are also specialist companies, like Orimlig Hyra AB who will buy your case off you and give you a refund within 48 hours, saving you a long wait in exchange for a cut of the money reclaimed.

Sjölin said that the rental board normally took about 8 months to come to a judgement, but that if the person with the first hand contract appeals, that could extend the waiting time by between six months and a year.

Url copied to clipboard!