A vitamin injection for the housing market. This is the effect that Hans Flink, sales and business development manager at Svensk mäklarstatistik, expects from the new proposals presented regarding mortgages and amortization requirements.
Just like the investigator Peter Englund, Hans Flink believes that in the short term, it can drive up prices somewhat.
When it finally turned, inflation went down and energy prices fell significantly, so you got a reverse effect and people dared to plan their future. It's a bit the same thing here. The signal itself is important, says Hans Flink.
The abolition of the stricter amortization requirement, as well as the proposal for a higher mortgage ceiling (from 85 to 90 percent), should primarily benefit first-time buyers who are taking the step into the housing market, notes Hans Flink:
Those who are already in the housing market "are already in the mill". For them, the cash contribution is not a problem. It certainly makes it easier to get into the housing market.
Fewer apartments
The effect should primarily be noticeable on smaller apartments, according to Hans Flink.
If we're talking about first-time buyers, it's about one- or two-room apartments. It can be positive for the towns that have universities or job opportunities, but where buyers have thought it was too expensive and there may not have been rental apartments.
Erik Holmberg, an analyst at the real estate website Hemnet, shares the view and emphasizes the effect that the amortization requirements had when they were introduced.
Looking historically, when the requirements were introduced in 2016 and 2018, it had a significant effect and has primarily held back price development on smaller apartments and in metropolitan areas, he says.
Less impact
The impact has been significantly less in rural areas and smaller towns, according to Erik Holmberg.
Against this background, if the proposals now become a reality, it is likely that housing prices in larger cities and price development on smaller apartments will be affected. I would be surprised if it doesn't have a fairly clear effect.
The major bank Nordea is more cautious and writes in an analysis that the proposals are "softer than expected". A smaller, but positive price development is to be expected, but the bank does not adjust its prognosis for housing prices.
