UK Only Article:
standard article
Issue:
The indispensable European
Fly Title:
Property in Sweden
Rubric:
House prices in Sweden continue to soar, to regulators’ despair
Location:
STOCKHOLM
Main image:
A rare sight
A rare sight
ASK a central banker what regulators should do when rock-bottom rates cause house prices to soar, and the reply will almost always be “macropru”. Raising rates to burst house-price bubbles is a bad idea, the logic runs, since the needs of the broader economy may not square with those of the property market. Instead, “macroprudential” measures, meaning restrictions on mortgage lending and borrowing, are seen as the answer. But this medicine is hard to administer, as Sweden’s housing market vividly illustrates.
Swedish house prices have doubled in the past decade, their rapid ascent only briefly interrupted by the financial crisis (see chart). So far this year they have risen by about 14%. Apartment ...
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