Best cities in Sweden to buy property?

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A team specialized in real estate investing in European countries

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Sweden. If you'd like to learn more about us, you can check our presentation page.

Which Swedish cities have experienced the fastest property price growth over the past five years?

Upper Norrland has recorded the fastest property price growth in Sweden, with an impressive 12.6% year-on-year increase as of 2025.

Northern Central Sweden follows with 8.5% annual growth, while Småland with the islands has achieved 6.4% price appreciation. This growth stems from increased remote work opportunities, industrial investments, and the relative affordability of these regions compared to major metropolitan areas.

Meanwhile, Stockholm County has experienced a price correction with a 1.7% decline, making it less attractive for short-term capital appreciation but potentially offering entry opportunities for long-term investors. Gothenburg has maintained modest growth at around 3.2%, while Malmö has performed better with 4.1% annual increases.

The shift toward smaller cities and northern regions reflects changing work patterns and lifestyle preferences, particularly accelerated by remote work trends since 2020.

It's something we develop in our Sweden property pack.

What are the current average property prices per square meter in major Swedish cities compared to smaller locations?

Stockholm commands the highest property prices in Sweden at €9,744 per square meter as of September 2025.

Gothenburg follows as the second most expensive major city at €5,446 per square meter, while Malmö offers more affordable options at €2,500 per square meter. Uppsala, despite being smaller than the three major cities, maintains relatively high prices at €6,200 per square meter due to its proximity to Stockholm and strong university presence.

Smaller cities and rural areas present significantly more affordable opportunities, with prices ranging from €1,000 to €3,000 per square meter. University towns like Lund maintain premium pricing at €5,800 per square meter, reflecting strong rental demand from students and academics.

The price gap between Stockholm and smaller cities has widened, creating opportunities for investors seeking higher yields in emerging markets outside the capital region.

What rental yields can property investors realistically expect in different Swedish cities?

Uppsala offers the highest gross rental yields in Sweden at 7.04%, making it the most attractive city for income-focused investors.

Malmö provides strong yields at 6.02%, benefiting from lower purchase prices and steady rental demand from young professionals and cross-border workers with Denmark. Gothenburg delivers moderate yields at 4.96%, while Stockholm lags behind at 4.23% due to high purchase prices relative to rental income.

Northern regions and smaller cities often achieve yields between 6.5% and 8.5%, though these markets may have higher vacancy risks and lower liquidity. Net yields typically run 1.5-2% lower than gross yields after accounting for property taxes, maintenance costs, and management fees.

Foreign investors should factor in currency exchange risks and local tax implications when calculating actual returns on Swedish property investments.

Which cities offer the strongest employment markets and population growth to support long-term property values?

Are there Swedish cities where property remains undervalued compared to national averages?

Cities in Upper Norrland, Småland, and several university towns like Umeå and Växjö are currently considered undervalued relative to Sweden's national property price average.

These markets benefit from lower base prices combined with emerging demand drivers such as industrial investments, remote work migration, and infrastructure development. Upper Norrland particularly stands out with properties priced 60-70% below Stockholm levels while experiencing the country's fastest growth rates.

University towns outside major metropolitan areas offer compelling value propositions, combining affordable entry prices with stable rental demand from student populations and academic staff. Cities like Luleå and Kiruna are experiencing industrial renaissance due to green energy projects and mining expansions.

The key risk in these undervalued markets is lower liquidity and longer selling times compared to established metropolitan areas, requiring investors to take longer-term perspectives.

It's something we develop in our Sweden property pack.

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What are the property tax rates and annual ownership costs across different Swedish cities?

Swedish property tax rates are standardized nationally, with owner-occupied houses taxed at 0.75% of assessed value or capped at SEK 9,525 annually, whichever is lower.

Apartments owned through housing associations face a lower rate of 0.3% of assessed value or maximum SEK 1,302 per year. These caps significantly benefit owners of higher-value properties, particularly in Stockholm and Gothenburg where actual tax rates often fall well below the nominal 0.75% rate.

Total transaction costs typically range from 5-11% of property value when buying and selling, including transfer taxes, legal fees, and real estate agent commissions. Annual maintenance costs vary by property age and type, with older properties in city centers requiring higher maintenance budgets.

Association fees for apartment buildings in major cities can range from SEK 3,000-8,000 monthly, covering building maintenance, heating, and common area management.

Which Swedish cities attract the highest demand from international buyers and expatriates?

Stockholm leads international buyer demand due to its large expatriate community, international business presence, and comprehensive English-language services including schools and healthcare.

1. Stockholm - Largest expat community, international schools, multinational corporations, diplomatic presence
2. Gothenburg - Major industrial hub attracting international professionals in automotive and shipping sectors
3. Malmö - Cross-border appeal for Danish workers, international university programs, growing tech scene
4. Uppsala - International academic community, research institutions, proximity to Stockholm
5. Lund - University town with significant international student and researcher populations

These cities offer established support networks for international residents, including housing assistance programs, language courses, and cultural integration services that facilitate property purchases by foreign buyers.

What mortgage interest rates and loan-to-value ratios are available to foreign property buyers in Sweden?

Foreign buyers in Sweden can access similar mortgage conditions as Swedish residents, with loan-to-value ratios capped at 85% by regulatory requirements.

The average LTV ratio for property purchases is approximately 68%, reflecting conservative lending practices and borrower preferences for lower debt levels. Mortgage interest rates in Sweden remain among Europe's most competitive, though they have increased from historic lows following 2023 policy changes.

EU residents face fewer restrictions than non-EU buyers, who may need to demonstrate stronger financial credentials and provide additional documentation. Banks typically require proof of income, employment stability, and comprehensive financial statements for foreign applicants.

First-time buyers may access government-backed loan programs with favorable terms, while investment property purchases face stricter lending criteria and higher required down payments.

How do rental regulations vary between Stockholm, Gothenburg, Malmö, and smaller Swedish cities?

All major Swedish cities operate under strict national rental control systems, but implementation and market dynamics differ significantly between locations.

Stockholm has the most complex rental market with extensive waiting lists for regulated apartments, often requiring 10-20 years for desirable locations. Private rental markets are more active but face increasing regulatory scrutiny regarding short-term rentals and subletting arrangements.

Gothenburg and Malmö have similar regulatory frameworks but shorter waiting times for regulated rentals, typically 3-8 years for central locations. Smaller cities offer much faster access to rental properties, with waiting times often under two years.

Tenant protection laws are uniformly strong across Sweden, making evictions difficult and rent increases strictly controlled. This creates stable rental income but limits flexibility for property owners to adjust to market conditions.

It's something we develop in our Sweden property pack.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Sweden versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

Which cities are investing most heavily in infrastructure, housing projects, and urban development?

Stockholm continues to receive the largest infrastructure investments, including major transport projects, housing developments, and commercial expansion initiatives.

Gothenburg is experiencing significant port expansion and industrial development, particularly in sustainable transportation and logistics sectors. The city's investment in green infrastructure and smart city technologies positions it for long-term growth.

Northern industrial hubs like Luleå and Kiruna are receiving massive investments in green energy projects, mining operations, and supporting infrastructure. These developments are transforming previously overlooked regions into high-growth opportunities.

Malmö and Uppsala are rapidly expanding housing supply and transport networks to accommodate population growth, with particular focus on sustainable development and transit-oriented communities.

Are there seasonal or regional differences in vacancy rates across Swedish cities?

Stockholm, Gothenburg, and Uppsala maintain the lowest vacancy rates year-round, typically below 2% for desirable locations.

University towns experience seasonal variations with higher vacancies during summer months when students leave, but these are generally short-term fluctuations. Smaller towns and northern regions historically showed higher vacancy rates, though rapid growth in emerging areas is reducing this gap.

Vacation areas may experience seasonal rental patterns, but permanent residential properties maintain consistent demand throughout the year. The Swedish rental market's stability means significant seasonal variations are uncommon outside specialized tourism-dependent locations.

Regional differences are more pronounced than seasonal ones, with metropolitan areas consistently outperforming rural locations in terms of occupancy rates and rental demand.

Which Swedish cities combine affordability with excellent quality of life, including safety, schools, and healthcare?

University towns like Umeå, Linköping, and Lund offer exceptional quality of life at more affordable prices than major metropolitan areas.

• Umeå - Vibrant university city with excellent cultural amenities, strong healthcare system, and property prices 50% below Stockholm levels
• Växjö - Known as Europe's greenest city, outstanding schools, low crime rates, affordable housing market
• Örebro - Central location providing access to major cities, strong healthcare facilities, family-friendly environment
• Linköping - Technology hub with aerospace industry, top-ranked university, excellent public services
• Karlstad - Lakeside location offering outdoor recreation, good schools, stable job market, reasonable property prices

These cities consistently rank high in Swedish quality of life surveys while offering property prices 30-60% lower than Stockholm, making them attractive for both residents and investors seeking stable, long-term returns.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Sweden Price Forecasts - InvestRopa
2. Average House Price in Sweden - InvestRopa
3. Sweden Rental Yields - Global Property Guide
4. Labour Market Information Sweden - EURES
5. Sweden Rent Yields - Global Property Guide
6. Job Creation and Local Economic Development Sweden - OECD
7. Guide to Working in Sweden as an Expat - April International
8. Sweden Taxes and Costs - Global Property Guide
9. Property Charge and Property Tax - Skatteverket
10. Top Cities for Expats in Sweden - TalkPal