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Fast Comment SwedenPreview: Housing prices for February (Wednesday)

  1. Looking for signs of stabilisation
  2. Indications of stronger price increases for apartments than for houses in February
  3. A lot of focus on Stockholm and on tenant-owned apartments
Looking for signs of stabilisation
Housing prices usually increase in February. In fact, they have not decreased, in monthly terms, since the start of the HOX index in 2005. The seasonal variation implies that if housing prices increase by, for example, 1 percent, the seasonally-adjusted monthly change is around 0.3 percent (our calculations). The Wednesday reading will be interesting, particularly as we were surprised by the strong January figure. After autumn’s price falls and the increased supply of apartments for sale, we are now looking for signs of stabilisation in the housing market. However, it is complicated by the stricter amortisation requirement introduced on March 1, which has potentially led to some temporary effects on supply and perhaps also on prices. In January, housing prices increased by around 1 percent in seasonally-adjusted monthly terms, according to the HOX index. This was above our expectations, as we expected a cautious decrease. However, the quality-adjusted HOX index diverged from Svensk Mäklarstatistik, as the latter pointed to a continued decrease.
Indications of stronger price increases for apartments than for houses in February
We note that the number of apartments up for sale remained high in February, although it dropped somewhat in Stockholm (city) at the end of the month. Was this a possible sign of temporary effects related to the new amortisation requirement? Data from Booli indicate that house prices in February were largely unchanged, whereas apartments appear to have had a more significant increase in monthly terms. Historically, however, the correlation between the HOX index and Booli data is not brilliant. Nevertheless, we expect seasonally-adjusted housing prices in February to slowly increase, compared to the previous month, followed by a price decline in March.
A lot of focus on Stockholm and on tenant-owned apartments
Much attention is paid to tenant-owned apartments in the Stockholm area. Not unjustified perhaps (see graph below), but compared to last year’s price fall in Norway, where Oslo accounted for most of the price correction, there has been a significantly more broad-based decline in housing prices in Sweden. The price drop for apartments in Stockholm amounts to around 9 percent since the peak last summer, but Gothenburg and Malmö are not far beyond, with a total drop in prices of around 6-7 percent. However, in January, house prices increased in Gothenburg and Malmö, while they continued to fall in Stockholm (S.A.).


Sources: Handelsbanken, Valueguard, Macrobond


Sources: Hemnet, Macrobond


Sources: Valueguard, Macrobond


Helena Bornevall

Senior Economist

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