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How much does it cost to rent an apartment in Gothenburg?

The cost of renting an apartment directly in Gothenburg has risen by less than inflation, but the same can't be said for the price of sublets. Here's how much you can now expect to pay in Sweden's second city.

How much does it cost to rent an apartment in Gothenburg?
Central Gothenburg is predictably the most expensive area to rent an apartment in. Photo: Per Pixel Petersson/imagebank.sweden.se

Sweden’s housing market is tightly controlled, with rents from the big private and municipal landlords set in negotiations with the Swedish Tenants’ Association, or Hyresgästsförening. Subletting rents – theoretically at least – are supposed to cover the costs of the apartment without making a profit.

So far this year, the hikes agreed with the Tenants’ Association have been well below the headline rate of inflation, meaning rents are falling in Sweden in real terms. The latest statistics on sublets, meanwhile, indicate that, in many areas, rents have been falling even in nominal terms – without being adjusted for inflation.

“In the wake of economic crisis, interest rate hikes and inflation, more and more Swedes are seeing the need to rent out part or all of their property,” explained Fredrik Strömsten, chief executive of Qasa, which runs Blocket’s property listings site, in a report in April.

There had, he said, been an “explosive increase in the number of sublets”. 

How much does it cost to rent an apartment in Gothenburg directly?  

The most recent rental numbers from Statistics Sweden data back to the end of 2022.

These show that while upmarket areas like central Gothenburg, Majorna and Härlanda are the most expensive areas to rent in, so-called “first-hand apartments” (apartments rented directly via the municipality’s housing queue) there are only about a third more expensive than those in much less desirable areas of the city, such as Västra Hisingen. 

These figures, however, give quite a misleading idea of the real cost of living in these parts of the city.

With queues for rental apartments in Majorna and Central Gothenburg running to about ten years, most foreigners coming to Sweden’s second city are unlikely to ever get a chance to rent at such rates.

Nonetheless, rents across Sweden are rising more slowly than inflation and Gothenburg is no exception. According to Hem & Hyra, the news site run by the Tenants’ Association, the big four municipal landlords with a total of 75,000 tenants agreed to hike rents by 4.25 percent in May, while private landlords with a total of 35,000 tenants agreed to hike rent by between 2.25 percent and 4.2 percent. 

The Tenants’ Association said it had bargained them down from an initial offer of 9.73 percent. 

This means that if you’re lucky enough to get to rent an apartment directly from a municipal or private landlord, you can expect to pay just over 4 percent more than the numbers in the table above.

What are rents like outside Gothenburg? 

If you decide to live in the municipalities outside Gothenburg, such as Kungälv, Mölndal, Härryda, and Lerum, rent can be cheaper and housing queues shorter, but it can also more expensive if you live in the most desirable municipalities such as Partille and Ale. 

How much does it cost to sublet an apartment in Gothenburg?

As a foreigner coming to Sweden, you are much more likely to end up subletting an apartment, using sites like Blocket or The Local’s own rental platform. And although Sweden’s rental rules are designed to prevent subletting for profit, in reality you will often find yourself paying a hefty premium.

Across most of Sweden sublet rents are stable or falling as cash-strapped renters are forced to sublet rooms or their entire apartments, but Gothenburg is something of an exception to this trend. 

The median rent for sublets in the city shot up by 12.7 percent between the first three months of 2022 and the first three months of 2023, increasing by as much as 21.2 percent in the Västra Göteborg district and by 15 percent in Örgryte-Härlanda. 

The rise in sublet rentals appears to have slowed down however, with only a slight increase between the last three months of 2022 and the first months of 2023.  

As you might expect, sublets in areas like Gothenburg Centrum, Majorna, Askim, Frölunda and Högsbo are the priciest, with sublet apartments going for roughly double what you would pay if you were lucky enough to get a direct lease on an apartment in these areas.  

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MONEY

Why is Sweden one of the first countries to lower interest rates?

Sweden, along with Switzerland, is among the first countries to lower interest rates in Europe. Why is this?

Why is Sweden one of the first countries to lower interest rates?

Sweden joined Switzerland, Czechia and Hungary in the small group of countries to lower their so-called policy rates earlier this week when the country’s central bank lowered the interest rate from 4 percent to 3.75.

There are natural explanations for this, according to financial experts.

“Sweden’s economy is more affected by interest rate hikes,” head economist at Nordea, Torbjörn Isaksson, told TT newswire.

Sweden’s GDP has shrunk four quarters in a row, putting Sweden at the bottom of the table when it comes to growth over the past year. Unemployment and bankruptcies have also gone up more than elsewhere.

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Isaksson believes that that’s the main reason Sweden is lowering its policy rate before other central banks, although he predicts the European central bank is only weeks away from lowering its key interest rate.

Although inflation in Sweden has dropped, the country still has higher inflation than both Denmark and Finland – the main reason for cutting the rate in Sweden is the fact that households here are so much more sensitive to high interest rates.

“A high level of household debt and short term loans has meant that high interest rates have hit harder here than elsewhere,” Isaksson said.

“That’s why there’s a greater need to take our foot off the brakes slightly.”

Having said that, Sweden’s economy still has a strong foundation.. Swedish business remains competitive, salaries are set “responsibly”, and the country has strong state finances, Isaksson said.

“Lowering interest rates while remaining hawkish is the best way to go,” SEB head economist Robert Bergqvist said.

“The central bank is showing that they’re taking this first step, they’re ready to take further steps, but they want to keep expectations low.”

Bergqvist described the Swedish economy as being out in the open sea, exposed to strong waves.

“We have strong state finances which work as an airbag, but I think the central bank is happy it can show that it’s reacting to what’s happening in the Swedish economy,” he said.

“It would almost be professional misconduct to not lower the interest rate based on what’s happening with inflation, so it’s hard for the central bank to avoid doing so.”

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