Swedish property prices rose in May – here’s by how much

Swedish property prices rose in May – here's by how much
The fact people are spending more time at home due to the pandemic could be a factor behind the rise. Photo: Ann-Sofi Rosenkvist/imagebank.sweden.se
Housing prices in Sweden went up slightly in May, with the trend holding steady in the first part of June.

According to analysis company Valueguard's index, the month of May saw a break in a slight downward trend. Nationwide, property prices rose by 2.2 percent month on month.

It was houses where the increase was most notable, with a 3 percent rise, while prices of apartments rose by an average of one percent. While prices are still on average lower than they were three months ago at the start of the outbreak, year-on-year prices for apartments have risen by 2.1 percent and houses by 6 percent, according to the Valueguard index.

There were also differences across Sweden's regions. The area around Malmö in southwestern Sweden saw the biggest change, with apartment prices rising by an average of 1.8 percent and houses by 3.5 percent.

“The Malmö region has coped well and the effect of the [coronavirus] pandemic is not as tangible as in other parts of the country, that has affected price development positively. Properties are also being sold noticeably faster now than during the same period last year,” Mattias Larsson, CEO of estate agent Bjurfors Malmö, said in a statement.

On a national level, the development for the first two weeks of June shows a continuation of the trend, with a rise of 1 percent in Stockholm and 0.8 percent in Gothenburg compared with May.

In fact, it's possible that for those whose income has remained stable, the coronavirus outbreak has actually been a cause of the rise.

“After the outbreak there are lots of people who have chosen to work from home,” said Sven-Erik Kristensen, CEO of Bjurfors Gothenburg in reference to national recommendations that everyone who can do so should work from home. “This has also put an extra focus on the housing situation and the need of a larger living space, which benefits the market for houses above all.”

However, many economists believe the negative effects of the crisis will be felt on the housing market later this year.

Handelsbanken has predicted a slow recovery for Sweden, and if unemployment rises to 15 percent (slightly higher than the worst case scenario outlined by the government in April), it said property prices could drop by as much as 20 percent.

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