Supply of housing in Sweden
Date
23/09/2015
Robert Emanuelson analyses the supply of housing in Sweden. He investigates the factors that have contributed to the low level of housing construction over recent decades.
The public sector's share of housing construction has, for example, decreased and government subsidies of new builds have been substantially reduced. New construction is also affected by a distorted incentives structure for both private and municipal builders. There are also laws and regulations that hamper competition on the market and that contribute to a lower-than desirable amount of land ready for development. One conclusion is that the structural problems on the housing market need to be addressed. With more homes, geographical mobility would increase and the labour market would also function better. Furthermore, the risks associated with high household debt would decrease.
The article is included in this year's second issue of the Sveriges Riksbank Economic Review , which was published 17 September 2015.
Robert Emanuelsson
The author works in the Financial Stability Department of the Riksbank .
