7/27/2019 SEB: Swedish households still optimistic on housing
market
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Households remain optimistic on the housing marketMONDAY
7 OCT, 2013
SEB HOUSING PRICE INDICATOR CONTINUES TO
SIGNAL RISING PRICES. SEBs Housing Price Indicatordeclined
marginally in October to 50 (Sep 51), butremains near the highest
levels since July 2007. Hence,improving labour market, rising
equity prices andpromises of tax cuts next year continues to
fuelhousehold optimism in Sweden. According to thesurvey 62% of the
responding households (Sep 61%)expect house prices to rise, while
12% (Sep 10%) expectprices to fall. 18% (Sep 20%) expect unchanged
prices.Households in Stockholm remain the most
optimistic;illustrating that overheated housing market is an
issuefor large metropolitan areas, and especially the capital.
While the Housing Price Indicator indicates a continuedrising
trend for home prices, we believe that regulatorymeasures will at
least partly offset the positive impact
from e.g. low rates and an improving economy.
NEW MEASURES TO DAMPEN LENDING. Next week,the Financial
Supervisory Authority is due to present aproposal for how to
increase amortisation. The aim is aregulation for banks to draw up
individual but voluntaryamortisation plans for new lending (or when
increasingloans to existing clients). The plans should according
tothe guidelines from the government state both why theplan is in
the long-term interest of the client and howthe client is relating
to the plan. Next summer, by thelatest, the FSA is also due to
present a
proposal for countercyclical capital buffers. Althoughthe aim
for this regulation is primarily to strengthen theresilience of
banks to future crisis it could also beexpected to affect
lending.
The FSA head, Martin Andersson, has warned that toorapid lending
would be met by strict amortisationdemands. However, last week
Andersson said there isno sign that such actions are warranted at
present. Thecomment came after new data showed lending growthstable
at 4.8%in August. Previous experience indicatesthat voluntary
actions could be effective. For instance, 9out of 10 households are
now amortising loans above75% loan-to-value in line with the
recommendationsfrom the Swedish Bankers Association.
Elisabet Kopelman +46 8 506 230 17
Since March 2003 weve contracted Demoskop to survey the Swedish
housing market every month. This survey was conducted 24 Sep 2 Oct,
2013.
-80
-60
-40
-20
0
20
40
60
80
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
SEB's Housing Price Indicator
Source: SEB, Demoskop
50
