• Sweden's news in English
 

Subletting in Sweden set to get more expensive

Published: 05 Dec 2012 15:33 GMT+01:00

The government wants to boost the supply of properties available for rent by removing the current cap on how much flat owners can charge would-be-tenants.

Currently, flat owners cannot charge whatever they want, instead they are restricted to setting a "reasonable rent" (skälig hyra).

That proviso means owners cannot set rent to cover the actual costs of ownership.

But starting on February 1st, 2013, property owners will be able to charge tenants rent in line with what it actually costs to own their homes.

The Riksdag's Civil Affairs Committee approved the government's proposal on Tuesday.

In addition to rent levels, the proposal strips tenants of the right to take landlords to court and reclaim money if they can prove they have paid too much rent according to the guidelines.

The Riksdag committee rejected, however, a related proposal that would allow tenants to rent out their homes without asking their tenancy organisation (bostadsrättsförening) for permission first.

Owners will still have to apply in writing before subletting their flats.

Tenant advocacy groups slammed the proposal, which should be voted into law on December 17th as the government leans on the minority Sweden Democrats to get a majority in parliament.

"The government and the Sweden Democrats don't care at all about renters," Barbro Engman, chair of the Swedish Union of Tenants (Hyresgästföreningen), said in a statement.

Engman thinks the new law is based on a "theoretical model" and will end up hurting those already struggling to find a place to live.

"Those who sublet are often young people who have a hard time breaking into the job market, so those who have the least ability to pay are going to be paying the most," she told the Metro newspaper.

Liberal Party (Folkpartiet) MP Nina Lundström, who serves as vice-chair of the Civil Affairs Committee, was optimistic that the new law would help ease the housing crunch that plagues Stockholm and many other cities in Sweden.

"I hope that we end up with more apartments with the guidelines on how sublet rents are set," she told the newspaper.

However, she admitted that the effects of the new law remain uncertain.

"It's hard to say today how much the volume of rental apartments will ultimately be affected."

The Local/dl

Follow The Local on Twitter

Your comments about this article

17:21 December 5, 2012 by pkpekka
What does "subletting" or "an apartment is rented out second hand" mean in this context? This is very strange terminology (very Swedish). If you own an apartment and then rent-it to somebody isn't this a first-hand contract? Or can you have a first-hand contract only if you rent from some governmental rental association? Do Swedish people not really own their apartments if you have to talk about "second-hand/andra hand" contracts in this case. What about all the Swedes who stand in line for 10-years for a first-hand contract and then rent their apartment(s) to pissed off foreigners or quest workers at inflated prices on the black marker? This is not going to be legal is it? I do applaud this more as a non-native if it brings some more apartments into the marker but much more needs to be done. People should not be able to hold onto their first-hand contracts the way they do now and they should be pricier in the first place (so there is less profit to be made from sub-letting or sub-sub-sub-letting). And I suppose they should build more apartments.
18:15 December 5, 2012 by Swedishmyth
Price controls lead to shortages? Surprise, surprise.

You could start by ousting the politically connected occupying inner city apartments at way below market value. But obviously that will never happen. Politics is involved in everything in Sweden. In fact, many Russian immigrants I've spoken to say that Sweden is more like Soviet Russia than contemporary Russia is.
19:08 December 5, 2012 by pkpekka
One should substantially increase the rent-control prices in the apartments that are on the queue in Stockholm area. This would increase circulation and reduce black-market profits. And make the most lucrative apartments entirely marker-priced by selling them to private rental companies or individuals. Then this extra money should be used to build more apartments, most of them market priced (at least 30-40 000 of them, the real shortage could of the order of 100 000?). Then markets would take care of the pricing when there is enough supply. Freeing up rent-control all over Stockholm might be too much to ask but there is no justification (other than corruption) for the most lucrative locations to be rent-controlled. For every "little-man" that has to more out of (central) Stockholm 5-10 would get a reasonably priced apartment in the outskirts of Stockholm, well with-in the metro lines (30-40 min commute). This is how it is in "normal" big cities. Abolish the queue-system step-by-step (if not otherwise possible)!
19:55 December 5, 2012 by engagebrain
These plans do not change the number of flats in Stockholm, they actually legitimise subletting, something that is now mostly illegal and exploits newcomers.

The result will be that rental flats will in future only become available when the primary tenant dies - otherwise they will keep on subletting and exploiting the unfortunate secondary tenant who gets pays a higher rent and gets sod all rights.

It would hardly be difficult to end subletting, just check who lives there, and make decent primary contracts available.
20:18 December 5, 2012 by ciaron9000
Can somebody please explain the Bostadratt system and why you can't buy the apartment outright.
20:45 December 5, 2012 by Beavis
ciaron9000 its a "share" in a collection of apartments the Bostadratt owns. So when you "buy" your apartment, your actually just buying a share in a group of them. Its an awful system but its the left overs from when the commys were in power who did whatever it took to make sure all apartments build in Sweden did not fall into private hands.
21:07 December 5, 2012 by Abe L
#6 - Hit the nail right on the head. It's a legacy leftover that needs to die ASAP.

Hence it's a shame that the most important part didn't pass, you still have to get permission from your bostadsrättsförening in order to rent it out, something you rarely get or only for a very limited amount of time. Which means that you as the tenant pay all the cost involved with owning a bostadsrätt but also that it's not used if you need to spend a few years abroad.

I otherwise think this is a step in the right direction and they can always correct the above point later on.
04:01 December 6, 2012 by banuazizi
Can anyone explain why Sweden doesn't just want to build more buildings/apartments when there's housing shortage EVERYWHERE ?
08:52 December 6, 2012 by smilingjack
why the reluctance of the bostadsrättsförening to allow leases?

I have encountered the same situation and even abuse from other tenants in the block because we were non swedes.

racism? concern over property abuse?

strange as hotorget where I was originally was mostly arabic ( see market stalls ), sudanese and back packers. as we were leaving a letter came saying the entire block was in a catastophic state of disrepair and that the block was going to cost a fortune to repair.

in our 3rd apartment now and have seen the same scenario unfold each time. half renovated apartments. short lease. no matter how pristine you thought the apartment was after you scrubbed it from top to bottom ( we were warned about obligatory cleaners having to come in ) the "owners" also found "major damage" and demanded payments. always for parts of the apartments that needed replacing. a good scam. but not so when you have a good foriegn lawyer.

I should probably post the name of the dodgy agent involved.
09:45 December 6, 2012 by engagebrain
re smilingjack & Abe K

Most bostadsrättsförening wil give permission for rentals of 1 or possibly 2 years.

The reason for not automatically gving permission is to try and keep blocks occupied by owners - people who have a longterm interest in maintaining the block and taking on the various jobs that are required.

Rentals by an owner or a secondary contract create a new and worse relationship between the association and the the temporary tenant, with little that an association can do to control an antisocial tenant. The last thing you want is to find that your neighbours are a series of stag party drunks just renting for the weekend.
10:33 December 6, 2012 by EP
What happens in the situation that you let your flat out, the BRF decides it doesn't want you letting it out and wants you to come back (or sell it). You're away from Sweden, or have moved away and you can't sell it because the market (for example) is down. Then it seems you're in a bind.

Strange system, in effect, you cannot own an investment property that is a flat in Sweden. Be it whether you're away or living in another BRF in Sweden, since as I've heard since you cannot be a member of 2 BRFs.

Arcane system and really stupid
12:00 December 6, 2012 by Shibumi
So those of us who rent are going to get even more screwed. No more price control pressure (not that it ever seemed to matter much) but we will still be thrown out after a year or two of paying outrageous rent prices even if we are model tenants. Just because the BRF said so and "rules are rules". This really sucks.
12:14 December 6, 2012 by engagebrain
If you want the housing market to really get out of control introduce private landlords and the buy to rent method - in the UK rents are completely out of control with those forced to rent, who cannot get primary contracts with decent associations, paying half their salaries in rent.

Another joy of private landlords is that many use every trick in the book to fleece tenants and they are very hard to nail through the courts.

Get rid of illegal secondary contracts, which is actually a different question to buy to rent, and the whole rental landscape will improve. Introduce private landlords and and a lot of people will get badly screwed. In London very high rents have not led to new building - this might lead to lower rents. Housing is too important to be left to the for profit sector.
13:12 December 6, 2012 by expatdave
If there are any Government officials reading this then try growing a pair and make some changes. People are not happy, it's plain to see.

Here are my tips:

1. Investigate those that have first hand contracts and whether they need them or are just scamming the system by renting them out again and pocketing a bucket load of money.

2. Those that are scamming the system obviously lose their contracts and their apartments are returned into the system to help those that actually need them. This should increase the supply.

3. Give people the right to rent out their 'bostadsrätt' apartment when and how they want. This will also increase supply and return the market to equilibrium.

and lastly by doing the above the market will become more attractive to investment companies and hence more apartments will magically get built much like everywhere else around the world.

Problem solved!
23:19 December 7, 2012 by henry.bn
What is wrong with the Böstadrätt system? It comes to the same thing as ownership in practice. And it also reduces the potential problems arising when neighbours let out to tenants who prove to be troublesome eg noisy..

It is a better system than the English leasehold, which gets the worst of all worlds. You pay ground rent to the freeholder and get nothing at all in return, plus maintenance charges which can be a rip-off, unrelated to actual costs. And if the neighbours sublet to troublesome tenants the freeholder is not usually going to enforce the conditions of the lease, which can lead to the run-down of the whole block. One problem is that people buy flats with no intention of living in them but to rent out. They don't give a damn about the neighbours if their tenants are eg noisy. This can make problems for those who have bought their flats to live in. It also causes a shortage of flats for owner-occupation.

Good that the government has not proceeded with this freedom to sublet - there is endless potential for trouble.
23:44 January 8, 2013 by mlatimudan
I can't really say that I fully grasp this system, but to be honest it seems insane. What does the ordinary Swede stand to gain from this system? Here in Croatia if you buy an apartment you are the owner in the full sense, not this leasehold like in the UK or this bostadsrätt in Sweden. If you want to rent it out, you are free to do so at any price you can fetch. If you want it to be empty for 10 years, which would be fairly stupid, you are free to do so.

We do have a small hitch with renting. From the owners point of view the tenants can, regardless of an existing contract, stay longer and the owner cannot legally evict them without a court order, nor can he cut off their water/electricity/heating, nor can he enter the flat and throw their things out and change the locks. And the courts here take forever, and all the bills are for the owner to pay so to get reimbursed from the tenants a private suite has to be filed.

With that being said, it still makes more sense than this Swedish system. At least to me.
Today's headlines
Spotify chief unveils Sweden innovation bash

Spotify chief unveils Sweden innovation bash

Spotify founder Daniel Ek and Avicii's manager Ash Pournouri are set to launch a major new tech and music event to reflect Stockholm's status as a lucrative hive of start-up activity, Billboard reports. READ  

The Local List
The ultimate guide to Sweden's party leaders
The outgoing leader of Sweden's Christian Democrats, Göran Hägglund, with the new leader, Ebba Busch Thor. Photo: Pontus Lundahl/TT

The ultimate guide to Sweden's party leaders

Two are pregnant, four are under 40 and nearly half are women. As the Christian Democrats elected their first female party head on Saturday, The Local's beginners' guide to Swedish political leaders reveals who has clung on to power and whose heads have rolled in the months since Sweden's general election in September 2014. READ  

Sweden Democrats boot seven in extremism row
From left, Sweden Democrat youth leaders Gustav Kasselstrand and William Hahne on Monday. Photo: Anders Wiklund/TT

Sweden Democrats boot seven in extremism row

Seven people have been expelled from the Sweden Democrats - including the two heads of the nationalist party's youth wing - in a row over far-right extremism, the party announced on Monday afternoon. READ  

Swedish arms giant one of Europe's 'cleanest'
An Air Force pilot uses a simulator to fly a Saab Gripen fighter aircraft at the LAAD Defense and Security International Exhibition in Rio de Janeiro, Brazil, Tuesday, April 14th 2015. Photo: AP/TT

Swedish arms giant one of Europe's 'cleanest'

Swedish defence giant Saab does more than most other European arms companies to tackle corruption but should give staff better access to whistleblowing channels, according to a Transparency International report released on Monday. READ  

Taxman: Cosmetic surgery is not deductible
Winners of the Miss Plastic Hungary beauty pageant. If they lived in Sweden they would not be able to make deductions for breast implants, nose jobs or face lifts. Photo: AP/TT

Taxman: Cosmetic surgery is not deductible

With next Monday the deadline for filing tax returns, Swedes will try to get the taxman to cover the cost of everything from milk to plastic surgery, explains a tax agency worker who has seen it all. READ  

My Swedish Career
Building my Swedish lego dream brick by brick
James Gill in his lego shop. Photo: The Local/Bobbie Carlson

Building my Swedish lego dream brick by brick

James Gill was working as a chef in the UK when he one day decided to combine his two passions in life: Sweden and Lego. The Local's reporter Bobbie Carlson visited his shop in Stockholm - and discovered that there is far more to the famous children's toy than meets the eye. READ  

Head rolls in Sweden’s private jets scandal
Anders Nyrén attends SCA's annual general meeting in Stockholm on April 15th 2015. Photo: Anders Wiklund/TT.

Head rolls in Sweden’s private jets scandal

A major corporate scandal involving the “excessive” use of private jets claimed a fresh victim on Monday as the main owners of investment giant Industrivärden blocked the under-fire CEO Anders Nyrén from taking over as chairman. READ  

US rap mogul Jay Z defends Tidal venture
Jay Z's got 99 problems but Tidal ain't one. Photo: Chris Pizzello/Invision/AP

US rap mogul Jay Z defends Tidal venture

Rapper Jay Z has defended his Tidal streaming service as viable and a boon to artists after a much-criticized start to the revamped company has given its main Swedish rivals at Spotify little cause for concern. READ  

Nepal earthquake
Swedes join earthquake rescue efforts in Nepal
Residents rescue items from the debris of a house damaged in Saturday's earthquake in Nepal. Photo: AP Photo/Bernat Armangue

Swedes join earthquake rescue efforts in Nepal

An expert team from Sweden is set to travel to Nepal on Monday to help with a search and rescue operation following a devastating earthquake which is believed to have claimed 3,200 lives so far. READ  

Rush-hour chaos for Swedish rail commuters
It's not the first time train delays cause headaches for Swedish commuters. Photo: Tomas Oneborg/SvD/TT

Rush-hour chaos for Swedish rail commuters

A faulty railway switch in Stockholm was expected to cause rush-hour headaches for travellers across Sweden on Monday morning after several trains were cancelled and others diverted. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Gallery
IN PICTURES: Sweden's Princess Leonore meets Pope Francis
VIDEO: How did these Swedish cops become New York heroes?
Business & Money
Five crucial things you need to know before you move to Sweden
Gallery
People-watching: April 25th
National
What's on in Sweden: April 23rd - 30th
Blog updates

24 April

Editor’s blog, April 24th (The Local Sweden) »

"Hi readers, Spring has well and truly arrived, as evidenced by the start of strawberry season. The..." READ »

 

15 April

Gång, timme, tid & dags (The Swedish Teacher) »

"Hej! In this article I will talk about “gång”, “timmar”, “dags” and “tid”, because they all translate..." READ »

 
 
 
Stockholm School of Economics
Sponsored Article
How the Stockholm School of Economics changes expat lives
National
Brits in Sweden face NHS black hole
Swedish Hasbeens
Sponsored Article
Is the world wrong to connect Sweden with sex?
Business & Money
The Swedish regions where you're least likely to stay jobless
Gallery
People-watching: April 22nd
Sport
Sweden's Eriksson joins row over foreign England player quotas
National
MEP says ignoring migrant crisis like 'Sweden's Holocaust appeasement'
Gallery
IN PICTURES: The Swedish mining town that's being moved
National
How much would you pay for first Swedish strawberries of 2015?
Gallery
Property of the week: Kungsholmen, Stockholm
Sponsored Article
Want to study in Sweden? Read why Stockholm is the best choice
Photo: TT
National
Get set for a sunny week in Sweden
Sponsored Article
Does far-north Sweden have to punch above its weight?
National
Refugees in Sweden fear for families lost at sea
National
Syria claims ‘most dangerous’ Isis leaders are Scandinavian
Gallery
People-watching: April 18th
National
Swedish researchers pore over link between coffee and cancer
Features
What you can buy in Sweden for the price of a London shed
National
What's on in Sweden this week
National
Swedes launch first donut into space
Politics
Is Sweden returning to 1990s social democratic welfare politics?
National
Mamma Mia! Abba entertainment venue set to open in Stockholm
Gallery
People-watching: April 15th
National
Why Sweden is top place in the world for expats to raise children
National
Swedish 'submarine' was civilian boat
National
Why has a US town got pulled into a Swedish spelling row?
Gallery
Property of the week: Hovås, Gothenburg
National
What does Zlatan think of his ban?
National
Swedish teenagers help rebuild Breivik massacre island
National
Would you live in a steel box?
National
How an act of kindness by one Syrian immigrant went viral
Gallery
People-watching: April 8th
National
Swedish bids for Billboard fame
National
Swedish monkeys denied Saudi visas
National
Sunny spring weather predicted
Sponsored Article
'Impossible' to run Skanska without Bromma Airport
National
Half of Swedes want begging ban
Gallery
Property of the week: Gotland
National
Why are expats less likely to settle down with Swedes?
Sport
What does Sweden think of Zlatan's recent outburst?
Society
Get to grips with Sweden's most bizarre Easter traditions
Gallery
People-watching: April 1st
National
The Local's best April Fools' gags
Sponsored Article
'Sweden must embrace openness and diversity'
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

3,338
jobs available
PSD Media
PSD Media is marketing company that offers innovative solutions for online retailers. We provide modern solutions that help increase traffic and raise conversion. Visit our site at:
psdmedia.se
?>