Housing market|According to the analysis of Aktia’s chief economist Lasse Corin, apartments in Finland have become cheaper in relation to the development of incomes. According to Corin, the wild rise in house prices in the other Nordic countries is explained by the prosperity of non-Finns.
The summary is made by artificial intelligence and checked by a human.
Apartment prices have fallen in Finland, Denmark and Sweden.
In Finland, prices have risen by only 10%, in the other Nordic countries by 46-78%.
The reasons are weak economic growth, urbanization and falling prices in remote areas.
Norway is an exception. Housing prices have not decreased there.
Apartments prices have come down by roughly the same amount in Sweden, Denmark and Finland in the last two years. According to Aktia bank’s analysis, the difference is that in the other Nordic countries the starting level was much higher.
Housing prices in Finland have only increased by about 10 percent since 2010. In other Nordic countries, apartments have become more expensive by 46–78 percent.
“Development in Finland has been apathetic”, Aktia’s chief economist Lasse Corin write.
In relation to the salary level, housing prices in Finland have even decreased. According to Corin, weak development in Finland is explained by strong continuous urbanization. The drop in housing prices in remote areas affects the housing price statistics of the entire country.
But economic growth also plays a role. In other Nordic countries, the economy has clearly grown faster than in Finland, and the residents of other Nordic countries have also become more prosperous than Finns.
Corin’s according to it, it would seem that the differences will grow even more. According to the International Monetary Fund’s IMF forecasts, Norway, Sweden and Denmark will maintain their competitiveness in the coming years, which means that the countries’ prosperity will continue.
Norway is an exception in the price development of apartments in the last couple of years. Apartments there have not become cheaper despite the rise in interest rates.
Norway also takes a more relaxed approach to indebtedness than other Nordic countries. In Finland, households have debt of 125 percent in relation to annual income, in Sweden the ratio is 180 and in Norway as much as 241 percent.
Denmark differs from other Nordic countries in the development of the housing market and consumer indebtedness. The global financial crisis 15 years ago hit the Danish banking and housing markets harder than other Nordic countries, where prices fell drastically at the time.
In 2008, the Danes had a debt of 300 percent in relation to their income. Today, the ratio is only about 190 percent. Denmark’s housing loan portfolio has clearly shrunk in the last couple of years as well.
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