Stockholm house prices place 12th in global study
Published: 20 Dec 10 08:42 CET | Print version
Online: http://www.thelocal.se/30954/20101220/
Sweden's capital Stockholm is the 12th most expensive city in which to buy a home, according to a major international study.
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Monaco is the most expensive city in the world in which to buy property, with an average square metre price of 407,000 kronor ($60,000).
London comes in second place on around 120,000 and Russia's capital Moscow comes in third alongside other high cost cities such as Paris, Singapore and Hong Kong with average prices in excess of 100,000 kronor.
Stockholm comes in 12th in a comparison of average 120 square metre-sized apartments across the cities, with current prices averaging 60,000 per square metres in central areas, according to Statistics Sweden (SCB).
According to the guide Latvia (Riga) was the faster climber among the countries considered in the third quarter, with year-on-year gains of 25 percent after a couple of tough years.
While prices have climbed the most in growth markets such as Singapore and Hong Kong, with double digit booms in Israel and Australia among others, the Nordic countries all showed stability returning small gains.
The Local reported last week that prices for apartments in Sweden had reached record highs in the last quarter.
Fuelled by housing shortages in the attractive areas of Sweden's major cities, prices have resumed their climb and estate agency Fastighetsbyrån dismissed talk of a housing bubble, with CEO Lars-Erik Nykvist arguing instead that as few bought homes for speculative purposes, the market is in balance.
According to Statistics Sweden, houses in Sweden have climbed in price by an average of 5 percent over the past 12 months, according to recently released figures.
What do you think? Leave your comment below.
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Exceptionally low Interest rates + High tax credits + the fact that people are effectively only renting from the bank because very few own their own house when its all come to an end.
One thing I do believe is that this system keeps prices high in an area that doesnt have a flood of foreign investment (i.e. its not paris, sydney or london at the end of the day) so the swedes have managed to maintain high prices and keeping it affordable (giving long lerm terms and good credits and interest rates)
- Interest Rates Down -> loans get a whole lot cheaper -> house prices go up
- Interest only mortgages become the norm -> servicing a loan gets cheaper -> house prices go up (did the previous generation not bother to pay off their loans? .. thought not)
- Why pay tax when you can offset it against your mortgage -> house prices go up!
- Capital gains tax payable on your residential home when you sell? -> makes you reluctant to sell? -> house prices go up!
- CGT is useful source of income for government -> why cool the market? -> prices should really only go in one direction - up!
- Restrict housing market through limiting who can buy a flat/condo? -> why would that encourage supply of new accommodation? ->house prices go up!
.. is there a picture starting to emerge here? Acero and others here are right.
WRONG.
I own two properties in Sweden and I never had to put a penny down. The only thing I pay is the interest on the loans and never the premium..
when did you buy your apartments? A few years ago?
The bank policy is very strict now.
I have just bought my apartment in May, and the bank want me to pay at least 10% for the downpayment. And then I still have 10% for the top loan that with highere interest rate, and i have to pay the morgagate for the 10% top loan.
So in the end of the day I have to pay 20% at least in total for the cost of the apartment
I have discussed the interest rate with handelsbanken, Swedbank, SBAB, and SEB bank. And the deal I got is the best deal I could get.
The 0% interest rate is no longer there, but maybe a few years back.
@ Rishonim,
According to your statement you have not bought a property in Sweden in at least five years. New rules mean a person has to put up a deposit.
However I also never had to put a penny down or pay any interest. I bought mine cash.
My friends however all have to put down about 10% to 15% before getting a mortgage under new rules.
One of the great things about Sweden is how cheap houses are.