Swedish house prices rising faster than anywhere in the EU
Despite being the third largest country in the European Union by area, the total population of Sweden is just 9.8 million, making for an average population density of just 21 citizens per square kilometre. Inhabitants tend to be concentrated in southern, urban, areas meaning that despite an abundance of space elsewhere, properties in Sweden are highly sought after. Consequently, Swedish property prices have seen the biggest increases of anywhere in the EU. So, if you’re an expat moving from Britain, is buying property in Sweden the smart choice for expats or is it preferable to rent instead?
The vast unspoiled landscape and large, dense, forests of Sweden make it a highly desirable location for expats who love the great outdoors. Hiking, cycling and even skiing are deeply ingrained in Swedish culture and the climate and geography provide the perfect backdrop for such adventurous activities. Despite its northern latitude – approximately 15% of Sweden lies north of the Arctic Circle – the climate is quite similar to that of the UK. In summer, temperatures can reach 25 °C (77 °F) in southern areas and in winter temperatures range between −4°C and 2 °C (25°C to 36 °F). However, in the northernmost regions, temperatures can get much colder.
With most inhabitants keen to stick to the temperate southern regions, demand for properties in these areas is high. On average, house prices rose by 2.9% in the Euro area and 3.8% in the European Union in 2015 according to Eurostat, the statistical office of the European Union. Sweden, however, saw significantly greater rises, with average property prices being 14.2% greater in Q4 of 2015 compared to Q4 of 2014. Hungary, the second highest rated country for house price inflation during this period, saw prices rise by 10.3%. In third place was the United Kingdom, where prices rose by an average of 7.1% during this period.
In the centre of Stockholm, apartments now average 86,415.62 kr (£7,391) per square metre to buy. Apartments outside the centre are far more affordable though, with apartments selling for an average of 50,696.18 kr (£4,335) per square metre. This is still significantly less expensive than London, for example, where apartments in the centre and outside the centre average £18,319 per square metre and £8780 per square metre respectively.
Swedish households are among the most indebted of anywhere in Europe, with the average mortgage holder having a debt worth 366% of their annual income. In response to concerns about mortgage debt and house price inflation in Sweden, the government is introducing laws to limit mortgage loans to a maximum term of 105 years. Yet despite these measures and predictions that the housing market would cool off in 2016, prices in this Scandinavian country are still on the rise.
Sweden is a country with a lot to offer expats: beautiful landscapes, a favourable work-life balance, and the best location for family life according to the HSBC Expat Explorer survey. If that wasn’t enough though, expats who buy property in Sweden could well expect an additional benefit: further increases in the value of their properties.
If you are planning to move to Sweden from London – for work, with family, temporary or permanent – Cadogan Tate will help you every step of the way. From your first enquiry to when you’re settled in at your new home, we are here to help and advise you. Find out more about our specialist international removals services from London.
Information correct at time of publication.