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The Residential Real Estate Market in Scandinavian Countries is segmented by Type (Condominiums, Villas, and Others), Key Cities and Other Urban, Suburban, and Rural markets.
2016 - 2026
Scandinavian countries are growing rapidly and are projected to be among the fastest-growing cities in Europe in the future. Rising house demand has not been matched by construction over a long period, due to taxes, regulation, and lack/mismatch of incentives. However, the increase in population and immigration is expected to bring growth in the housing market in countries, such as Sweden and Norway.
The Swedish economy grew by about 2.3%, in 2018. The country faced a declining demand in 2018, and the total number of new houses sold in the country declined by 4.9% Y-o-Y to 52,599 units. The outlook for 2019 is not very bright, as the country is likely to witness a decrease in residential construction. Areas, like the Greater Stockholm, saw a sharp decline of around 35% in the housing construction. However, Sweden is witnessing an increased interest from international investors for rental apartments.
Norway’s economy grew by approximately 1.8% in 2018, and it is expected to grow by 2% in 2019. The residential market in Norway is shaped by a long-time policy goal of homeownership, and up to 85% of citizens have their own home, which is usually less taxable. Norway’s housing market has been witnessing a steady decline in housing prices. However, the Norwegian residential real estate market is stabilizing, since the last quarter of 2019, due to increasing interest rates and stricter mortgage rules. The country witnessed an increase of 4.6% in the residential property sales to 65,214 units, in the first three quarters of 2019. The supply of new homes has varied, but the larger cities, like Oslo, have a fair supply of previously industrial sites being changed to new residential areas. Additionally, some municipalities bordering the big cities, especially Oslo, have zoned a lot of new residential plots that attract a high demand.
In 2018, Denmark’s economy grew by around 1.2%, and the economy is expected to expand by 1.6% in 2019. The country is currently facing a housing shortage, and residential construction is not keeping up with the growing population. The problem is intense, especially in cities, such as Copenhagen. However, the country is experiencing a rising demand for purpose-built rented accommodation.
This report aims to provide a detailed analysis of the Scandinavian residential real estate market. It focuses on the market dynamics, technological trends, insights, and government initiatives taken in the residential real estate sector. Moreover, it analyses the key players and the competitive landscape present in the Scandinavian residential real estate market.
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The Scandinavian countries are facing a shortage in the housing units and the issue is more prominent in the Swedish housing market, primarily in its metropolitan regions. The level of additional new homes has been very low, while population growth has been high and, and according to the forecast, this is likely to continue.
Housing prices in Sweden are decreasing due to strict mortgage requirements, deteriorating investor confidence, and slowing economic growth. Sweden’s nationwide house price index fell by 1.53 in 2018, in contrast to Y-o-Y increase of 7.57% in 2017.
However, in Denmark, the house prices continue to rise, despite the falling demand due to the introduction of tighter lending standards and slowing economic growth. The price index of one-family houses in Denmark increased by a modest 3.28% in 2018, after Y-o-Y increase of 4.01% in 2017.
Norway’s housing market is currently witnessing a stable demand. However, the country has weak construction activity, stricter mortgage rules, and gradually rising mortgage rates. The country’s house price index increased by 2.27% during 2018, after Y-o-Y increase of 0.73%, in 2017.
An increase in housing price indexes in these countries is likely to boost investors’ confidence in the Scandinavian countries, which is likely to increase demand for new housing construction.
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Among the Scandinavian countries, Denmark has shown a rising trend for rental accommodation. Rental housing in Denmark serves different social groups, from low income to medium income groups.
Urban markets with restricted land resources, strict zoning regulations, and having housing shortages drive up rents and reduce accessibility to the social housing. These factors are acting as a driver for the private rental housing sector for low- and middle-income groups.
In 2019, the average house rent for general housing in Denmark was 833 DKK per m2, which is higher than the previous year. The rental yields in Denmark have also recovered in the recent years, as rents have risen faster than house prices. The average gross rental yields in Copenhagen typically range from 4.84% to 5.31%. In family housing, the average rent of houses increased to DKK 811 per m2 in 2019, as compared to DKK 802 per m2 in 2018. In older homes, the average rent increased by 0.6%, in 2018. In youth housing, the average rent increased by 1.3% to DKK 928 per m2. By comparison, the average rental price levels witnessed an increase in 2018.
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The residential real estate market in Scandinavian countries is competitive. Competition and pricing have increased strongly, and new investors and developers have entered the market. Moreover, both demand and supply of real estates are increasing. Interest rates and financing terms are creating a very attractive investment environment for the companies.
1.1 Study Assumptions
1.2 Scope of the Study
2. Research Methodology
3. Executive Summary
4. Market Insights
4.1 Current Economic Scenario and Consumer Sentiment
4.2 Residential Real Estate Buying Trends - Socioeconomic and Demographic Insights
4.3 Government Initiatives and Regulatory Aspects for Residential Real Estate Sector
4.4 Insights oInsights on Size of Real Estate Lending and Loan to Value Trends size of real estate lending and loan to value trends
4.5 Insights on Interest Rate Regime for General Economy, and Real Estate Lending
4.6 Insights on Rental Yields in Residential Real Estate Segment
4.7 Insights on Capital Market Penetration and REIT Presence in Residential Real Estate
4.8 Insights on Affordable Housing Support Provided by Government and Public-private Partnerships
4.9 Insights on Real Estate Tech and Start-ups Active in the Real Estate Segment (Broking, Social Media, Facility Management, and Property Management)
4.10 Market Dynamics
5. Market Segmentation
5.1 Quantitative and Qualitative Commentary on Supply and Demand (Condominiums, Villas, and Others)
5.2 Quantitative and Qualitative Commentary on Supply and Demand (Key Cities)
5.3 Key Cities
5.4 Quantitative and Qualitative Commentary on Transaction Volumes (Covering Property Types and Key Cities, Other Urban, Sub-urban and Key Rural Markets
6. Competitve Landscape
6.1 Overview (Market Concentration and Major Players)
6.2 Company Profiles
6.2.2 Fastighets AB Balder
6.2.3 L E Lundbergforetagen AB
6.2.4 Akelius Residential Property AB
6.2.5 Oscar Properties Holding AB
6.2.6 Danish Homes
6.2.7 EDC Maeglerne
6.2.8 Dades AS
6.2.9 A Enggaard AS
6.2.10 ELF Development AS
6.2.11 Betonmastaehre AS
6.2.12 OBOS BBL
6.2.13 Veidekke ASA
6.2.14 Krogsveen Eiendomsmegling
7. Future of the Market and Analyst Recommendations
9. About Us
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