Long Swedish market interest rates have climbed upwards for a while. The interest rate on a ten-year Swedish government bond has risen from levels around 2.20 percent in the summer to almost 2.70 percent – the highest levels since the autumn of 2023.
The Swedish Central Bank's message that the reduction to 1.75 percent in the policy rate is the bottom and that the next step is likely to be an interest rate hike – possibly as early as 2026-2027 – gave a small extra boost upwards on market interest rates with longer maturities.
Fixed mortgage rates are raised
When long market interest rates rise, it puts pressure on the banks' costs for financing long mortgages. This usually results in the interest rates on mortgages with longer maturities being raised.
But trying to pinpoint the right time to bind mortgages is extremely difficult, according to Christina Sahlberg, savings economist at the comparison site Compricer.
But it's not too late now, she thinks:
The train has not left, you should as usual look at your own conditions.
Based on the banks' average interest rates, i.e. the interest rate that the bank's customers on average have managed to negotiate, the gap was relatively small between variable and fixed in August.
Danske Bank offered the lowest variable interest rate, 2.73 percent, among the major players. However, those who chose to bind for 2 years got an interest rate of 2.86 percent at the same time, i.e. only 0.13 percentage points higher.
If I'm going to stay and think it feels safe to know what I'll pay every month, then it's not wrong to bind now, says Christina Sahlberg.
Since variable has historically often been better than fixed.
Calm on the housing market
On the housing market, there has been a calm the last few months. In August, prices in the country fell by a modest 0.3 percent, according to Swedish brokerage statistics. Chief economist Robert Boije at the state-owned mortgage bank SBAB also does not think that today's interest rate cut will have any significant impact.
I don't think this will get the housing market going. 25 basis points have an incredibly marginal effect on the housing market, possibly that it creates a certain sense of security for households, he says.
