Swedish Housing Market Faces Regional Price Divergence and Risks for Buyers in Late 2025
Sweden’s housing market sees recovery in Stockholm contrasted by widespread price declines elsewhere, with government easing mortgage rules expected amid rising financial risks for buyers.
- • Apartment prices are lower than 2021 in 125 out of 179 municipalities, with many exceeding 10% decline.
- • Stockholm shows strong price recovery with faster sales and higher prices.
- • Government plans to ease amortization and increase loan-to-value ratios to 90%.
- • Handelsbanken warns buyers to carefully check condominium associations’ financial health.
Key details
Sweden’s housing market continues to show a stark divide in late 2025, with prices recovering in central Stockholm while many other municipalities face ongoing declines. According to a Swedbank and Sparbankerna analysis discussed by Dagens Nyheter, apartment prices are still lower in 125 out of 179 municipalities compared to 2021, and in 39 municipalities the falls exceed 10%. Areas such as Botkyrka, Haninge, and Upplands Väsby have seen prices retreat to levels last seen in 2015.
The contrast is clear in Stockholm’s inner city, where apartments sell quickly—on average in just over two weeks—and 90% of sales reach or surpass asking prices. Surrounding areas, however, experience much longer selling periods and more than half of apartments are sold below their asking price. This uneven recovery follows the end of Sweden’s decade-long era of negative interest rates, which had previously made borrowing extremely cheap and homeownership nearly risk-free.
Private economist Arturo Arques warns of significant financial risks, especially for buyers who purchased in 2021 and now face market values below their purchase prices, threatening their entire down payment. In response to the evolving market, the government is expected to propose easing amortization requirements and raise loan-to-value ratios from 85% to 90%, a move likely to push prices up but also increase borrowing risks.
For prospective condominium buyers, Handelsbanken cautions vigilance. Mikael Forssén, head of Guidance & Recommendations at Handelsbanken, highlights the need to scrutinize the financial health of housing associations beyond just monthly fees. Many associations may be underfunding maintenance, face high debt levels increasing vulnerability to interest rate hikes, or have leasehold arrangements (tomträtt) that could lead to rising costs. Buyers should also verify if associations are 'genuine' (majority owner-occupied) or 'non-genuine' due to rental income ratios impacting tax treatment.
With the market split geographically and financially complex, careful due diligence is essential for anyone entering Sweden’s housing market amid these late-2025 trends.