For members


What does the ‘exceptionally weak’ Swedish krona mean for you?

Ignoring a few months in the financial crisis, the Swedish krona is now weaker than it's been in a century. What does that mean for internationals planning to moving here, or those who already have?

What does the 'exceptionally weak' Swedish krona mean for you?
The weak krona means executives coming from Europe and the US will be able to buy a more expensive house. Photo: Hasse Holmberg/TT
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The krona dropped still lower last week after Sweden's central bank signalled that with inflation still stubbornly under target there was now no chance of an end to negative interest rates this summer. You now need 10.6 kronor to buy a euro, up from 8.2 back in 2012. 
“It's quite clear that the krona is exceptionally weak,” Andreas Wallström, Chief Analyst at Nordea Markets, tells The Local. “Apart from the financial crisis, you have to go back 100 years to find it weaker…although of course the euro didn't exist back then, so it's sort of a synthetic euro.”
He doesn't expect change any time soon. 
“There's currently nothing really pointing to a strengthening of the krona. If you look at growth relative to the eurozone, we are really in for a slowdown now, whereas growth in Europe is quite strong.” 
Richard Falkenhäll, Senior FX Strategist at SEB, agrees:  “We have probably, along with Switzerland, the lowest short-term interest rates in the world right now, at -0.5, and that's despite several years of very strong growth.”
“That's a very negative thing for the Swedish krona, so I think we have to get used to a weaker Stocky [krona] at least this year and probably into next year.”  
If you're a tourist, of course, this is wonderful news: a pint of beer that would have cost you a jaw-dropping nine euros five years back now costs under seven.  
But if you're an international who's come to Sweden to work, or is planning to, it's rather less appealing. 
“You should make sure that you don't get paid in Swedish krona,” Wallström says, slightly tongue-in-cheek. 
Jamie Hart, Managing Director at the recruitment firm Michael Page in Stockholm, says the low exchange rate is less of a problem for a foreigner negotiating their salary ahead of a move to Sweden, as their pay will normally be set by the real cost of living. 
“It will just cost the companies more to match up to the euro equivalent,” he says. “Generally speaking if you're recruiting people, the exchange rate is not what you base pay on, it's based on the cost of living.” 
People moving to Sweden may also find buying a house is a less daunting prospect that it was. 
“As the housing market in Sweden has lost about 10 percent in the last year, at least in Bromma where I work, you are getting a double effect,” says Pär Gunnarsson, who works for Swedish estate agents Fastighetsbyrån. 
And while he hasn't noticed an increase in the number of foreign buyers, he suspects those that come are able to spend more. 
“When you buy a house in Stockholm or Sweden, it's basically because you're moving here, and you buy the house you can afford. I don't think we have more foreign buyers in Stockholm, but maybe they can buy a more expensive house.” 
The exchange rate is more of an issue for workers who negotiated a pay deal back in 2012, when the krona was much higher.
If you negotiated an annual salary of 800,000 kronor back then, you've now taken a pretty substantial €21,000 cut in your annual euro earnings. 
“For an expat today having an income in krona, you probably just have to get used to earning less,” Falkenhäll says. “It's the same for us Swedes. It's starting to get quite expensive to travel abroad.” 
But Wallström believes it's not all bad news, as the low exchange rate combined with strong global demand is leading to boom times for Swedish exporters. 
“Swedish exporters are enjoying happy days and there is a  labour shortage in many sectors, so the demand for foreigners is likely to increase,” he says. 
Those already working in export-driven industries are in a powerful position to negotiate a pay increase, while those applying for jobs can probably afford to be quite demanding when it comes to salary. 
“There's a big demand for international skillsets particularly in the technology field, digital and engineering,” Hart says. “There's a big demand for people who want to move.” 
For many of people he recruits from the UK and Europe, salary is not the only reason to move to Sweden anyway. 
“There's upside in terms of quality of life, the length of your commute, the number of hours you work,” he says. “There's still positives about working in Sweden.” 
Still want to move to Sweden? Looking for a new job? Find your dream English-language role on The Local Jobs.

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For members


Cost of living: How expensive is Sweden compared to a year ago?

Those living in Sweden have no doubt noticed that things have become a lot more expensive over the past year – but just how much more expensive is life in Sweden than a year ago?

Cost of living: How expensive is Sweden compared to a year ago?

How much does fuel cost?

This depends on what kind of fuel you use – a litre of ethanol for example costs around half that of HVO100, a renewable alternative to diesel. All the prices listed below were the average price on August 10th, 2023.

For those using petrol, specifically Bensin 95 (unleaded petrol), the price per litre on August 10th was 20.89 kronor, compared to 19.33 kronor per litre a year ago.

The price of ethanol, also sold under the name E85, has remained relatively stable over the past year, standing at 15.10 kronor per litre on August 10th, compared with 15.87 kronor per litre in August 2022.

Diesel prices are a bit higher at 24.36 kronor per litre in August 2023, up from 22.91 last year.

Finally, the price of HVO100 is around 30.67 kronor per litre this month, up from 28.87 in 2022.

What about energy prices?

Energy prices are in general lower in summer than winter, especially given the wet and dreary summer Sweden has had, which has been good news for wind and hydropower.

The most recent figures available are from July 2023, and prices vary depending on which energy price zone you live in. All prices here are rörliga or variable monthly rates – not hourly rates – and they don’t include VAT, so the actual amount on your energy bill will be higher.

We’ve used prices from Vattenfall, one of Sweden’s largest energy producers.

Energy zone 1 – the cheapest energy zone – is in the far north of Sweden, and it includes Norrbotten county and part of Västerbotten county.

Prices in zone 1 last month were around 47.93 öre per kilowatt hour, higher than the 31.61 öre per kWh consumers in energy zone 1 paid last year.

Energy zone 2 is slightly further south, and it includes Jämtland county, Västernorrland county, and parts of Gävleborg and Västerbotten counties.

Prices here were similar at 47.95 öre per kWh in July compared to 31.64 öre per kWh in 2022.

Energy zone 3 covers central Sweden, encompassing Stockholm and Gothenburg, as well as Stockholm county, Södermanland county, Uppsala county, Värmland county, Västmanland county, Örebro county, Östergötland county, Dalarna county, and parts of Halland, Kalmar, Jönköping, Västra Götaland, and Gävleborg counties.

Here, prices were extremely high at this time last year – a whopping 100.89 öre per kWh in July 2022 – although the figures for this year are much lower at 48.66 öre per kWh.

Energy zone 4 – the most expensive zone – includes Malmö, Skåne, Blekinge, Kronoberg, and parts of Kalmar, Halland, Jönköping and Västra Götaland counties.

In July year, users in this zone were paying an eye-watering 137.58 öre per kWh, with this year’s figures a much more reasonable 52.78 öre per kWh.

There’s also some good news for Swedish households this autumn as prices are not expected to be anywhere near the levels seen last year, mainly due to water reservoirs (crucial for hydropower) being well-filled by the recent rain, and also due to well-stocked gas reservoirs in the rest of Europe cutting the continent’s reliance on Russian gas.

Of course, this may change, especially if the war in Ukraine worsens, but for now at least, it seems like Sweden is in for a cheaper winter on the energy front this year than in 2022.

How are property prices faring?

Over the past three months, the average price of an apartment in a housing cooperative – a bostadsrätt – was 43,608 kronor per square metre, according to Svensk Mäklarstatistik, an organisation that keeps data on the real estate market.

The average sales price of apartments across the country over the same period was 2,787,000 kronor, with prices highest in Stockholm, Gothenburg and Malmö, and lower elsewhere.

When it comes to the price of detached homes or villor over the past three months, sales prices have been lower, at 30,100 kronor per square metre, although the average sales price was higher, at 3,714,000 kronor.

Compared to last year, apartment prices are down 2.4 percent from 43,092 kronor per square metre and an average sales price of 2,767,000 kronor. The decrease is even larger for detached houses, which have gone down 10.2 percent in value in the past 12 months from a price per square metre of 29,547 kronor and an average sales price of 3,689,000 kronor.

Of course, that doesn’t say much about how much housing costs have increased for the average person in Sweden.

The Financial Supervisory Authority’s most recent report on housing costs for mortgage holders in Sweden is from March 2023, and it indicates that households in Sweden spend on average 12 percent of their income on interest rate payments, which is 2 percent higher than in 2022, and also the highest figure measured by the authority since records began in 2012.

The key interest rate has increased by 0.75 percentage points since March 2023, so this number is now likely higher.

This does not take into account the cost of paying off a loan – amortering – with government regulations stipulating that households must repay between 0 and 3 percent of the total value of the loan per year, depending on how large their loan is in comparison to their yearly income, and how large their cash deposit was in relation to their mortgage.

In terms of rental properties, the Swedish Tenants’ Association which is responsible for negotiating first-hand rentals, has agreed rent hikes of around 4 percent, on average, compared with last year.

For people in second-hand rentals, landlords are able to set prices at a level which covers their own mortgage costs – so it is likely that prices have gone up in line with increased interest rates for property owners.

How much have food prices gone up?

It’s difficult to say in kronor how much food prices have increased, as your food shop depends so much on the exact products you usually buy.

Instead, we can look at the general percentage increase of a number of items across all the largest chains, which is exactly what food price comparison site Matpriskollen has done.

According to the site’s statistics, food prices went up by 0.2 percent month-on-month in July. Price hikes were recorded on 20 percent of the 43,000 items measured, while 9 percent of products decreased in price. The majority of products – 71 percent – stayed the same price in July.

On a yearly basis, food prices have increased by 9.5 percent. Looking back to January 2022, when prices first started going up, the price of food has gone up by a whopping 21.6 percent.

So, how much more expensive is it to live in Sweden than it was a year ago?

The best way to look at this is by using the figures for inflation, collected by Statistics Sweden. The Consumer Price Index (CPI) is the standard measure for inflation in Sweden, which measures the average change in prices paid by consumers over a set period of time.

Figures for July or August have not yet been released, but the most recent CPI figures in June indicate that Sweden became 9.3 percent more expensive between June 2022 and June 2023.

CPIF inflation – the consumer price index with a fixed interest rate – is slightly lower, with an increase of 6.4 percent between June 2022 and June 2023.