Housing Prices Rise in March but Face Uncertainty After Market Crash

The development on the housing market is still uneven. After last month's decline, prices rose in March, primarily for tenant-owned apartments. At the national level, a 1.1 percent increase is noted compared to the previous month, while for villas it is a more modest increase of 0.1 percent.

On the other hand, prices continue to fall on an annual basis and are now at 4.2 percent for tenant-owned apartments. The March figures, however, were registered before the sharp stock market crash that shook financial markets worldwide.

Difficult to make a prognosis

The market uncertainty could theoretically spill over to the housing market with falling prices and reduced activity. Erik Wikander, Vice CEO of Svensk Fastighetsförmedling, notes, however, that it is difficult to make a clear prognosis:

It is possible that you will see a reflection in the April and May figures, but the reality is that we know very little about whether it will be like this or if it is a negotiating tactic, he says to TT about the impact of tariffs on the housing market.

In the spring of 2020, the last major stock market crash was noted, then in connection with the outbreak of the pandemic. This, however, did not have a negative effect on housing prices, and instead, villa prices rose clearly as a pandemic effect, and the stock market also recovered quickly.

Several perspectives

If unemployment rises, it can have an impact on the housing market, but from several perspectives, notes Erik Wikander:

You can see unemployment from two different angles. For the individual, it is naturally extremely negative and involves uncertainty. At the same time, from the housing market perspective, it is something that can trigger chains of moves, but for a sad reason when people need to move due to cost reasons, he says.

His assessment is still a weaker price increase ahead, rather than a price fall.