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Building industry for single family houses in crisis and the Swedish housing sector nose dives.

Thursday, 08 December 2011
Construction of single-family homes in Sweden have died down as a result of economic concerns and more stringent requirements from banks to lend money to would be home owners

 The industry is facing the worst crisis since the 1990s and has turned to the Prime Minister for support, writes Swedish business daily, Dagens Industri.

The trade association, TMF is reported to have sent a letters to the Prime Minister, Fredrik Reinfeldt this week.  The letter is reported to have contained information and warning to the Prime Minister to take responsibility and quash immediately the mortgage ceiling that was instituted so as to reduce the rate of borrowing for house purchase. It was also aimed at reducing the astronomical rise in house prices as well as to reduce Swedish citizen’s household debts burden which has been analysed as one of the highest in the world.

"We hope that the Prime Minister understand that a reduction in house construction contributes negatively to growth in Sweden. We went first into recession because of the the mortgage ceiling, and then came the usual recession on top of it, "says Mikael Olsson, CEO of TMF Trähus to the paper.

The industry is facing a crisis similar to that in the early 1990s, when many house manufacturers went bankrupt, writes the economic newspaper Dagens Industri

Since the stock market collapse in August, building construction firms have experienced an almost completely stagnant market. 2007, which was a peak year for home construction, 14,000 houses were produced. The forecast for next year is 5,000 houses.

Member companies of the TMF trade organisation have reduced their workforce by almost a thousand people, including contracted staff and temporary employees, according to Michael Olsson, reports the paper
By Scancomark.se Team


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