Home ยป Sweden – The Property Market – Residential Property

Sweden – The Property Market – Residential Property

Credits: Melker Dahlstrand/imagebank.sweden.seReal housing prices have approximately doubled in the past 15 years. In 2014, prices increased by 7%. Construction of new residential property has lagged Sweden’s population growth for a considerable period of time, creating an imbalance between supply and demand. This is particularly true in the Sweden’s larger cities, with Stockholm’s Chamber of Commerce citing a current shortage of over 100,000 homes.
Like in Ireland or the U.K., there are freehold and rental properties. However, another common form of ownership is a housing cooperative (bostadsrattsforening). Members of a cooperative formally own the right (bostadsratt) to inhabit their respective apartment for an unlimited time, a right that can be bought and sold on the open real estate market. This cooperative structure is one of the main forms of home ownership in the country, and a membership in a housing cooperative is generally held to be the same thing as owning (as opposed to renting) an apartment. Each member holds a shareholding in the cooperative that is proportional to the area of his apartment.
One of the core tenets of Assetbase is that the income from the property must have the ability to pay cover costs, including capital and interest on bank borrowings. Yields are such in the Stockholm, Malmo and Gothenborg residential markets that this is not feasible. Assetbase therefore concentrate on secondary cities. To date this has been in areas along the west coast, such as Uddevalla, Trollhattan, Vanersborg. We also look at opportunities to convert rental properties to either owner occupier or cooperative structures.