House prices: gulf widens between downtown and suburbs
James Savage · 25 Jul 2007, 19:20
Published: 25 Jul 2007 19:20 GMT+02:00
Prices in the Stockholm suburbs have always been lower than prices downtown, but even though prices are also increasing in the suburbs, the the gap is widening, according to statistics from the Association of Real Estate Agents. In 2002 it was 64 percent more expensive to live in the heart of the Swedish capital than in its suburbs; today it is 84 percent more expensive.
The average apartment in central Stockholm now costs 53,000 kronor per square metre, compared to 29,000 kronor outside, the statistics show.
The economic good times and the fact that people are willing to invest a higher proportion of their incomes in their homes has pushed prices up across the board. But prices in city centres, and particularly central Stockholm, have increased more rapidly.
"People want to be close to nature and to the pulse of the big city, with restaurants, cinemas and entertainment, as well as having the shortest possible commute," Niclas Strahner of real estate agents Svensk Fastighetsförmedling told The Local.
The price increases reflect in part the fact that people are prepared to put a higher proportion of their income into their homes. Strahner says some people now put 30 or 40 percent of their incomes into their homes, compared to 20 percent in the past.
Prices are going up across the board, with central Gothenburg's average square metre price recently passing 30,000 kronor, and Malmö prices passing 20,000 kronor. Changes to taxation introduced by the government and low unemployment have played a role in the increases.
"People have more money than ever," said Strahner, "but the most important thing is people's faith in the future, and right now that is very high."
But while the gap between prices in Stockholm city centre and the suburbs is widening, downtown prices still have a "ripple effect" on the outskirts, says Strahner.
"Not everyone can afford to live in central Stockholm. We're starting to see a real upswing in areas like Liljeholmen, Aspudden and Midsommarkransen, as well as places like Hammarby Sjöstad and Hammarby."
"When you speak with our agents in places like Hammarby and Årsta, you see that downtown residents - particularly young families - are starting to move out to get a bit more for their money. And as people look to live further outside, the culture and commerce follows," Strahner added.