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Thinking about buying a 3-bedroom apartment in Södermalm? It’s a vibrant area, but you're probably wondering: is now the right time to buy, or should you wait for prices to drop?
And what about long-term investment—should you look into other districts like Östermalm or Vasastan where property values might appreciate more over time?
In this article, we’ll answer these questions. We know this market quite well - and we have put all our knowledge in the Sweden Property Pack.
Will property prices increase in Sweden in 2025?
No, property prices in Sweden are not expected to rise in 2025, due to a combination of economic challenges and market dynamics.
Backed by our fresh, in-depth market analysis, we’re seeing signs that the Swedish property market may face downward pressure in the coming years.
While there are some positive indicators like urbanization and government incentives, the prevailing economic conditions and market trends suggest a potential decline in property prices.
Signals pointing to a property price increase in Sweden
Here are some factors suggesting prices could increase:
Continued urbanization trends in major cities like Stockholm and Gothenburg are expected to sustain demand for housing, potentially supporting property prices in these areas.
Government initiatives aimed at increasing housing supply and improving affordability could stimulate the market, encouraging more transactions and potentially stabilizing prices.
Sweden's strong economic fundamentals, including a robust labor market and high levels of employment, may provide a cushion against significant property price declines.
Signals pointing to a property price decrease in Sweden
Here are some factors suggesting prices could fall:
Rising interest rates are making mortgages more expensive, which could deter potential buyers and reduce demand for housing.
Inflationary pressures are increasing the cost of living, which may limit the purchasing power of potential homebuyers and lead to a cooling of the property market.
A potential oversupply of new housing developments in certain areas could lead to increased competition among sellers, driving prices down.
Economic uncertainties, both domestically and globally, could impact consumer confidence and lead to a more cautious approach to property investments.
Stricter lending criteria from banks and financial institutions may limit access to credit, reducing the number of qualified buyers in the market.
Demographic shifts, such as an aging population, could alter housing demand patterns, potentially leading to a decrease in property values in certain regions.
Potential changes in government policies or regulations affecting the housing market could introduce uncertainties that negatively impact property prices.
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If property prices go up in Sweden, how much would they increase by?
If real estate prices in Sweden were to rise in 2025, the increase would likely be around 2% to 4% of their 2024 values.
Typically, real estate in stable, mature markets like Sweden appreciates by approximately 2% to 4% annually over the long term. However, fluctuations can occur depending on factors such as region, season, and property type.
It means that, if you spot a charming 2-bedroom apartment in Stockholm for 4,500,000 SEK today, don't be surprised if it's priced between 4,590,000 and 4,680,000 SEK this time next year.
To give you a better understanding, here is a table that shows 7 types of Swedish real estate properties, their estimated prices in 2024, and projections for 2025 based on potential price increases of 2%, 3%, and 4%.
| Type of Property | Average Price in 2024 (SEK) | Price in 2025 (2% increase) | Price in 2025 (3% increase) | Price in 2025 (4% increase) |
|---|---|---|---|---|
| City Apartment (60 sqm / 646 sqft) | 4,500,000 | 4,590,000 | 4,635,000 | 4,680,000 |
| Modern Apartment (75 sqm / 807 sqft) | 6,000,000 | 6,120,000 | 6,180,000 | 6,240,000 |
| Luxury Penthouse (100 sqm / 1,076 sqft) | 12,500,000 | 12,750,000 | 12,875,000 | 13,000,000 |
| Studio (30 sqm / 323 sqft) | 2,250,000 | 2,295,000 | 2,317,500 | 2,340,000 |
| Loft (80 sqm / 861 sqft) | 8,000,000 | 8,160,000 | 8,240,000 | 8,320,000 |
| Townhouse (150 sqm / 1,615 sqft) | 17,500,000 | 17,850,000 | 18,025,000 | 18,200,000 |
| Investment Property (50 sqm / 538 sqft) | 3,750,000 | 3,825,000 | 3,862,500 | 3,900,000 |
Everything you need to know is included in our Property Pack for Sweden
If real estate prices go up in Sweden, which areas are likely to see the biggest increases?
Today, people who want to move to Sweden are looking for a blend of natural beauty, modern conveniences, and vibrant cultural scenes, which Södermalm in Stockholm delivers. Hence, we could see a price increase there in 2025.
Also, lately, there's been a shift toward more youthful, vibrant neighborhoods, and Vasastan has really taken off.
We like it when information is clear and easy to digest. So, here’s a table that highlights the areas where prices might rise the most, along with the reasons behind those expected increases. It’s very high-level. If you want more details on a specific area, please check our real estate pack tailored to the Swedish market.
| Neighborhood | Level of Increase | Why |
|---|---|---|
| Södermalm, Stockholm | High | Recent development of luxury housing projects and its increasing appeal to international buyers as travel normalizes post-pandemic, driving demand. |
| Östermalm, Stockholm | High | Expected rise due to limited housing stock, upcoming renovations to heritage buildings, and growing demand for prime properties in central Stockholm. |
| Haga, Gothenburg | Medium-High | Ongoing gentrification and new transport links, along with several planned redevelopment projects in the area, are likely to push prices higher. |
| Kista, Stockholm | Medium | The shift towards hybrid workspaces is driving demand for residential properties near business districts, combined with new mixed-use developments. |
| Lund, Skåne | Medium-High | Eco-friendly urban projects and recent construction of new schools and parks are increasing its attractiveness for families, pushing prices upward. |
| Gamla Stan, Stockholm | Medium | Investment in local infrastructure, such as the extension of tram lines and renovation of historic areas, is boosting long-term value. |
| Vasastan, Stockholm | High | Upcoming large-scale urban regeneration projects and improved public transport access are expected to make this area more desirable. |
| Malmö City Centre | Medium-High | Its proximity to Copenhagen, along with new office and residential developments, makes it increasingly attractive to professionals seeking more space. |
| Uppsala | Medium | Gentrification and cultural regeneration projects are attracting new residents, leading to rising prices as the area becomes more fashionable. |
| Djursholm, Stockholm | High | As new luxury developments are launched, demand for premium housing among wealthy buyers is expected to further increase property values. |
| Djurgården, Stockholm | High | Upcoming restoration of cultural landmarks and high-profile projects are driving a renewed focus on this central, historic location. |
If I'm looking to invest in real estate, what types of properties should I focus on for the best value appreciation in Sweden?
In 2025, Sweden's real estate trends focus on tech-smart, energy-efficient apartments, larger suburban homes for families, properties with outdoor spaces, and eco-friendly buildings—all driving higher demand and prices. Here is a summary.
- Tech-Equipped and Energy-Efficient Apartments:
Driven by remote work and sustainability trends, these homes offer smart technology features and energy-saving systems. They cater to young professionals and tech workers, making them a hot commodity in 2025, especially in cities like Stockholm and Gothenburg.
- Family-Sized Homes in Suburban Areas:
With a growing demand for larger living spaces, especially among families, suburban areas near major cities like Stockholm and Malmö are seeing increased interest. Proximity to nature reserves and quality schools is a major factor driving value.
- Properties with Outdoor Spaces:
Post-pandemic, outdoor spaces like terraces, balconies, or gardens have become highly desirable. In urban areas, these features offer a much-needed escape and are likely to drive up property values, particularly in cities with limited green space.
- Eco-Friendly Buildings with Low Carbon Footprints:
Sweden's strong commitment to sustainability is boosting demand for eco-certified buildings. Buyers are increasingly valuing properties that align with the country's green goals, leading to price appreciation in this category.
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