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Fast Comment SwedenHousing prices stable in July, but remain on track to beat our expectations for 2019

  1. HOX housing prices unchanged in July, but rising on an annual basis
  2. The rise is broad, even if some big cities wrestle with unique issues
  3. We have assumed roughly flat housing prices 2019, but developments thus far look better; risks ahead!
HOX housing prices unchanged in July, but rising on an annual basis
In actual terms, housing prices fell 0.3 percent m-o-m in July. Decreasing prices are normal for July; adjusting for the seasonal effect, housing prices were unchanged compared to the previous month. So far, most months in 2019 have posted rising prices. Compared to July last year, prices are up by 2.2 percent.
The rise is broad, even if some big cities wrestle with unique issues
Prices for houses and flats are on the rise. House prices are doing worse in Stockholm than in other cities. For flats, the same is true for Gothenburg. Overall, however, the price rises appear broad-based.
We have assumed roughly flat housing prices 2019, but developments thus far look better; risks ahead!
At the start of this year, we anticipated more or less unchanged housing prices for 2019, as positive and negative forces were deemed to balance each other. Now, with more than half of 2019 gone, it is fair to say there is upside risk to our previous call. Overall housing prices are currently trending above 2 percent y-o-y, while consumer confidence and several other household indicators have been resilient to global growth worries and market turmoil. It suggests that potential contagion to the housing market is not imminent. On Wednesday, August 21, we will release a new edition of our Global Macro Forecast report, including downward revisions to our Swedish economic outlook for 2020. Hence, we will keep monitoring housing prices closely.

 

Housing prices stagnant in July, but looking at the past year they remain on track to register a rise in 2019 as a whole.



The current annual rate is 2.2 percent, driven mainly by houses even if flats are also rising in price 



Overall housing prices remain roughly 3.5 percent below peak 



 


Source: Macrobond



 


Source: Macrobond


Activity in the housing market has picked up further during 2019 





Disclaimer

Johan Löf

Senior Economist

Sweden

jolo22@handelsbanken.se

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