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Fast Comment SwedenPreview: Housing prices in August

  1. Signs of small price movements in August
  2. The housing market continues to chug along
  3. Regional differences likely to continue
Signs of small price movements in August
The HOX index figure for August is to be released next Tuesday. Normally, housing prices are somewhat higher in August compared to previous months; a 1.3 percent increase corresponds to unchanged prices in seasonally adjusted terms (our calculations). Svensk Mäklarstatistik showed that prices for houses were unchanged, and those for tenant-owned apartments increased by 1 percent in August compared to the three previous months. This indicates small price movements in August. In July, housing prices, according to HOX, decreased by 0.5 percent in seasonally adjusted monthly terms (decreased by 0.6 non-seasonally adjusted). Nevertheless, we have seen a stabilisation since the beginning of the year. Housing prices have increased by on average 0.1 percent during the first seven months of this year, seasonally adjusted. All in all, housing prices are 5.6 percent lower than at the peak at the end of last summer.
The housing market continues to chug along
Signs of a stabilisation in housing prices have made households slightly more optimistic, both in terms of consumer confidence and developments on the housing market. Besides the effect on activity related to the implementation of the stricter amortisation requirements (as of March 1), the number of sales has been fairly normal. The higher-than-normal number of homes for sale is having a dampening effect on housing prices though, and this effect is likely to continue for some time to come, as more new homes are added to the market. Therefore, we do not expect a quick rebound in overall housing prices in the coming months.
Regional differences likely to continue
Over the past 12 months, housing prices in Malmö have outperformed those in Stockholm and Gothenburg and it is likely that this trend will continue, in our view. The regions less hit by the amortisation requirements and higher supply will most likely see stronger developments in housing prices in the near term, but not in line with previous years’ price increases, we believe. The slowdown has been broad-based and we note, among other things, that the share of housing units with a final price below the asking price is still higher than in previous years in many regions, including Malmö.

Please see graphs and comments below.



Over the past seven months, we have seen signs of stabilisation. Housing prices have increased by on average 0.1 percent since the beginning of the year, seasonally adjusted.   


Source: Valueguard, Macrobond


The number of homes for sale on Hemnet has continued to increase. However, as long as there are not very rapid, and unanticipated, changes in the supply, we believe that the market can withstand this without significant effects on housing prices.


Source: Hemnet, Macrobond




Stronger consumer confidence and an exceptionally low risk of unemployment, according to households in the NIER survey. Good support for housing prices.

 


Source: NIER, Macrobond


Disclaimer

Helena Bornevall

Senior Economist

Scenario Analysis

hebo12@handelsbanken.se

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