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Billions more needed to rid housing shortage

The Local
post 27.Oct.2010, 08:48 AM
Post #1
Location: Stockholm
Joined: 22.Dec.2004

A national government agency has estimated that another 19 billion kronor ($2.81 billion) are needed to "build away" Sweden's housing shortage every year.

Although 35,000 new homes are needed every year to address the shortage, but only 28,000 are being built, according to the National Housing Credit Guarantee Board's (Statens Bostadskreditnämnd, BKN) report "What would it cost to build out the housing shortage?" published on Wednesday.

The board is a national government agency under the Ministry of Finance. It publishes a market report three times a year in February, May and October.

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EtoileBrilliant
post 27.Oct.2010, 09:55 AM
Post #2
Joined: 28.Feb.2007

There's an elephant in the room and as usual the Swedes don't want to talk about it. Its called rental housing market reform. Until landlords are able to command market rates for their properties there is no incentive to build.
The Economist published their annual property survey last week:
http://www.economist.com/node/17311841?story_id=17311841
It showed Swedish house prices are 41.5% overvalued. Their metric is based on the discrepancy between rental yields and property prices.The answer is to deregulate the rental market and let rents go up. This will slow the growth (or even reverse it) in Swedish property prices.
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eppie
post 27.Oct.2010, 10:08 AM
Post #3
Joined: 29.Apr.2010

@ EtoileBrilliant
But if the rental market is deregulated rental prices will increase (a lot) making it again more interesting to buy?
Further the house price is probably overvalued largely because of the possibility to get back part of the interest paid on your mortgage.
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Frabelais
post 27.Oct.2010, 10:22 AM
Post #4
Joined: 11.Oct.2010

@EB
Typical of deregulation proponents, you use your statistical evidence selectively. The same great gap in 'overvaluation' is evident in places as diverse as Australia (63%), Hong Kong (58%), and France (42%).
Why don't you come clean, EB? No matter what the situation, you want the market deregulated.
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EtoileBrilliant
post 27.Oct.2010, 11:36 AM
Post #5
Joined: 28.Feb.2007

@eppie - Sorry if I wasn't clear. If you can charge market based yields for new properties, people will build new rental apartments and thus take the pressure off the owner-occupied market.
@frabelais - you're pretty cocky for somebody so ignorant. Let me come clean. I am long two properties in the Stockholm area. If the market was deregulated and house prices came down, I would be the last person to laugh. However, I'd like to think that I form a point of view no matter how contrary it is to my own circumstances. If you don't believe me, ask the OECD. They've been recommending the same course of action for years now:
http://www.oecd.org/document/1/0,3343,en_2..._1_1_1_1,00.htm
Now I've explained my position, perhaps you can explain which part of my earlier posts led you to believe "No matter what the situation, you want the market deregulated" or are you just mouthing off?
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Hustla
post 27.Oct.2010, 01:50 PM
Post #6
Joined: 2.Sep.2010

Supply and demand is a simple concept, but there will be no supply if you cannot cash in on the demand.. Simple.Economics. not just for the housing market.
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Sam1
post 27.Oct.2010, 02:28 PM
Post #7
Joined: 15.Jun.2009

The north of Sweden is hardly populated ...civilize the place up there ..specialy the hospitals and vårdcentrals then have more life in the markets..More opportunities more indoor activities...Then there would be a less crowd in the south...Since people run away from the situation in the north...in the south everything runs better hospitals, work, life, technology, nightlife, more friends, more culture..
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mojofat
post 27.Oct.2010, 03:48 PM
Post #8
Joined: 5.Jun.2010

@Sam1 Wouldn't that cost even more? Not only would you have the same costs associated with new buildings but you would also have to build the extra infrastructure that's already in place in the southern areas. Plus, as you point out, nobody wants to live there.
The deregulators are correct. I can't imagine a worse business to be in than apartment building owner in Sweden. Your told who will rent from you, your told what you can charge, and no doubt there are all sorts of fees/taxes/maintenance one must pay for. Finding an apartment to live in is a miserable process here. Aside from the obvious scams seeking upfront deposits before they'll show you the place, I've been hit up for "cash-in-hand" deals where they want me to pay them for the privilege of selecting me to sublet their place for 6 months.
Here's an original thought: how about just letting landlords advertise their rentals as they see fit and allow me to contact them as I see fit, instead of forcing everyone to use that worthless Boplats.se website. I applied for student housing back in May and I recently contacted them to find out if I could get a place. They didn't quite laugh in my face, but they told me it would be approximately 3 years! And I'm in a 2 year program!! Government controlled housing has never worked anywhere.
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janswed
post 27.Oct.2010, 04:47 PM
Post #9
Joined: 9.Jul.2010

Sam 1 Having been born and raised in the 'uncivilised' north of Sweden.who are you to comment on the north , I am sure compared to the Islamic hellhole from where you originate it is paradise for now, untill you and youre ilk decide to move there and ruine the place.
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jazzIIIlove
post 27.Oct.2010, 08:31 PM
Post #10
Joined: 6.Aug.2009

guys, in fact, Sam1 has a good point. Wouldn't it be nice to move the population to north? I mean what if there are more opportunities in north, then southerns will definitely move for new opportunities.
But Sam1, bro, here is pretty cold. I am not sure even there will be good stuff here, people may not want to come, this is psychological acceptability.
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Swedesmith
post 27.Oct.2010, 11:17 PM
Post #11
Joined: 11.Dec.2009

We have a saying up here in the north country, "-40 tends to keep the riff-raff out".
We have another saying, too. "I'm from the government and I'm here to help you." Sarcasm intenden.
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anticommie
post 28.Oct.2010, 04:36 AM
Post #12
Joined: 16.Apr.2009

Socialism Fail
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engagebrain
post 28.Oct.2010, 07:58 AM
Post #13
Joined: 10.Sep.2009

The problem is Stockholm is the black rental market, which pushes up rents but the rip off rent does not go the landlord.
It could be easily eliminated by simply checking on who actually lives in each flat.
Why is this massive and illegal activity allowed to persist ?
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ATinNM
post 28.Oct.2010, 09:28 PM
Post #14
Joined: 7.Jul.2010

Housing Market Reform!
Because it's worked so well in Iceland.
And the US.
And Ireland.
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Tdye
post 31.Oct.2010, 08:48 PM
Post #15
Location: North America
Joined: 7.Aug.2010

@ aTinNM
good point
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