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Average family "cannot afford a house"

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12:26 CET+01:00
Average families where both parents are in blue-collar jobs on a collective wage agreement are no longer able to afford to buy a house in most parts of Sweden, according to a new report.

For the second year in a row the National Association of Homeowners has studied the living costs of families with children. This year's figures show that a couple whose income is based on average trade union salaries would not be able to buy a small house in 270 of Sweden's 290 districts.

If one of the parents ended up working only 75% of the time or became unemployed, they would not be able to afford a property anywhere in the country.

"We believe that blue-collar workers should be able to afford to live in their own house," said the vice-director of the association, Elisabeth Österman.

"Unfortunately the research shows that it's hard. The main problem is the property tax, which needs a fundamental rethink."

Families in the Stockholm suburb of Danderyd face the highest housing costs at an average of 15,970 kronor per month. At the other end of the scale, a family in Ragunda pays an average of 4,045 kronor per month.

According to the report, housing expenses eat up between 16% and 58% of a trade union member family's disposable income, compared to between 12% and 46% for a professional family.

But Elisabeth Österman says that it will only get worse in 2006.

"Next year the taxable values of properties will rise on average 23%, which will lead to a comparable increase in property tax," she said.

"What's more, the National Institute of Economic Research is anticipating an increase in interest rates of 2%. That means that the margins will be even smaller."

The figures in the report were based on a mother, father and two children, where the parents were a transport worker and a child carer and made a 10% down-payment on a house with electric heating.

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