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Continued falls in Swedish house pricesTuesday, 17 January 2012
“Thou Shall do all to avoid bubbles in the Economy” - The case of Swedish house prices.
Swedish housing prices continue to fall ushering fears that the ballooning house bubble in the economy could burst soon.
The area with the fastest fall is the price is in the Malmö region of Southern Sweden as the Danes who had traditionally in the past years boosted the areas house prices shied back home as their economy faltered. Also the Swedish Krona became stronger over the Danish Krona as the Swedish currency regained some power from past years of devaluation.
Therefore, in the southern parts of Sweden, one could see that real Condo prices have fallen by 10 percent and house prices 4 percent in three months.
Prices in the housing market in the country on the whole continue to back off on a broad front. It is mainly residential rates that are falling. During the past three months, house prices decreased prices by 2 percent in the country as well as in Stockholm. At the same time, prices fell by 1 and 4 percent in the Gothenburg and Malmö regions.
AdvertisementThe average villa now costs nearly Skr1.8 million in Sweden. In Greater Stockholm one has to pay Skr3.1 million.
Condominium prices have risen by 2 percent in three months, according to the Swedish housing Broker Association data. In Greater Stockholm, prices remained unchanged, while they have fallen by 3 percent in central locations. In Gothenburg and Malmö regions recorded a slump in prices by 5 and 10 percent respectively. The average price for a condominium is now at Skr20,200 per square meter in the Kingdom.
In central Stockholm apartment costs Skr54,300 per square meter on average, while the inhabitants of Gothenburg and Malmo have to pay Skr33,300 or Skr17,800 per square meter in central locations.
House price growth for Stockholm has to do with the growth potential of the city and its area. "Stockholm has its inherent power in that there is a big move in Stockholm to growth more. By 2030, Stockholm would have grown at on more Gothenburg size,” said Peeter Pütsep of the Real Estate Association.
Peeter Pütsep also believe that crisis in Europe is also behind the price declines.
"It is still an uncertainty in the euro area and southern Europe, and this market is controlled much of psychology, " he said and points out that the financial turmoil is something that speculators are talking about the teaching.
The latest interest rate cut and amortized interest rate hike plans from the Swedish Central Bank for the year that started may counteract a further price decline. But right now there are many factors in the other scales, according to Peeter Pütsep.
"Probably, prices can still go down somewhat, but I do not see any dramatic fall. The development started in the fall and will perhaps continue for a while, "says Peeter Pütsep and describes also the issue where prices are heading in 2012 as" unpredictable. "
By Scancomark.se Team
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