The housing market has been quite cool during the spring. It's good that it has come to life a bit, but when we look at the underlying development, we see that the market still doesn't want to recover properly, says Robert Boije, chief economist at SBAB.
Housing prices normally follow clear seasonal variations with an increase in May, followed by a lull and a decrease in June and July to then take off again after the summer holidays in August.
Last month, we had a similar development. We believe that the shaky global situation continues to haunt a little. It will be exciting to see if we get a big jump up in August as we usually do.
Gothenburg stands out
For villas, the increase was 1.3 percent, for apartments 0.3 percent. Adjusted for season and other temporary effects, prices fell by 0.2 percent for the country as a whole.
Greater Gothenburg was the only region where apartment prices fell, minus 1.9 percent. Northern Sweden was, on the other hand, the only region where villa prices fell, by 0.5 percent. Greater Malmö, on the other hand, is the only region that has regained the price drop on apartments – and is also approaching on the villa side – that occurred in conjunction with the interest rate shock in 2022.
SBAB calculated a price increase of 6 percent this year in its first full-year prognosis. The figure was later adjusted down to 3 percent. The development so far does not give reason to adjust it up, says Robert Boije.
"Much psychology"
Last week, fresh figures from the Statistics Sweden revealed that Swedish GDP unexpectedly fell by 0.2 percent in the first quarter compared to last year. In annual rate, the weak figure means a growth of 0.9 percent compared to the expected 1.7 percent.
The figure increases the likelihood of an interest rate cut from the Swedish Central Bank. Generally, however, housing prices are more affected by the fixed interest rates than the variable, which is most affected by the Swedish Central Bank's interest rate cut, says Boije.
On the other hand, there is much psychology on the housing market, so if you see the Swedish Central Bank lowering the interest rate once or maybe even twice this year, it could have a small significance.
