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Few Swedish people feel that house prices will fall

Monday, 13 May 2013

A large number of  Swedish households expect that house prices will rise in the nearest future. Only 13 percent of the 1,000 respondents in a news survey believe that prices will fall.

A study carried out by the Swedish bank,  SEB in it's so-called house price indicator for the month of May reports about the change and continue that it's only about marginal changes compared to what was reported in the Bank's house price perception a month ago.

Boprisindikatorn, or house price index or indicator shows the difference between the proportion of households in Sweden who believe in rising prices and the proportion who believe in falling prices. That difference stands at 45 in May from the previous month.

Of those surveyed, 58 percent believe that home prices will increase, compared to 59 percent last month. 13 percent believe in falling prices, compared with 14 percent in April.

SEB's private economist, Gunilla Nyström, notes that the slowdown in the boprisindikatorn talks of a stable price trends nationally - rather than a house price rally.

Households think that the interest rates or the repo rate will stand at 1.21 per cent this year. In the April survey it was assessed that the repo rate will get to 1.30 percent twelve months ahead.

"Households have perceived that the economic recovery is slow and that the Riksbank (central bank) expects that it will take longer than previously forecast before the repo rate begins to be raised," said Gunilla Nyström.

Of those households, which have been on fully or partially variable rates on their mortgages or housing loans, three percent answered and  said they intend to fix their interest rate within the next three months, compared with 6 percent from last month.

Boprisindikatorn, looking at regional variation, show that prise growth perception rose most in Skåne, southern Sweden but is highest in the Stockholm area. The growth was 27 percent in Skåne, compared to 13 percent last month. In the Stockholm area, the indicator was 63, compared with 55 last month, in Västra Götaland, the indicator is 47 compared to 46 in April poll.

By Scancomark.com Team

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