The Stockholm Syndrome: A 20-Year Wait For Affordable Housing
In Stockholm, housing is hard to come by at any price.
The Swedes, according to statistics, love to pro-create. More than any other country in the EU, apparently. Nothing wrong with that. But throw a tech boom and an immigration policy as relaxed as a supermodel’s belt and you have an historic housing crisis. So historic that the Guinness Book of World Records are considering adding Stockholm to their storied ranks. There’s a 20-year wait in some parts of town for affordable housing. Makes Brooklyn seem like a tumble weed ghost town of yore.
Stockholm is getting everything it wants all at once and it can’t cope. It’s getting so bad that music streaming giant Spotify, which is located there, recently wrote an open letter to policy makers warning that it could expand its business elsewhere if the government doesn’t take action quickly. It’s a double edged sword because Stockholm is often touted as one of the most desirable locations on the planet to be an expat. But having a dream job and finding a place to live are two quite different propositions. It’s a perfect storm of over-crowding— Europe’s fastest growing capital has increased by almost quarter of a million people in just seven years.
On average it takes nine years to be granted a rent controlled property — and that becomes two decades in some of the most popular neighborhoods. You’d think under these conditions Swedes would be packed ten to a room. Apparently not. Despite the housing shortages, those cool Scandinavians are maintaining their standards. Sweden has a higher proportion of single-person properties than nearly all other EU countries. But that doesn’t account for immigrants, who in many cases actually are packed ten to room much to the consternation of many locals.
The main issue Stockholm has faced is the lack of forward thinking from successive governments in building new homes. Though Stockholm is feeling the squeeze for affordable housing most acutely, all of Sweden, with record low interest rates, appears to have rediscovered their Viking roots and are pillaging their savings and taking on debt with wild abandon. Swedish house prices have risen faster than Latin voter registration after a Trump debate. Sweden’s household debt to disposable income rate is at a record high of about 180 percent, even as it has fallen in both the US and UK following the 2008 financial crisis. In Stockholm, new borrowers, many in the tech industry, have debt of more than five times their income. Good thing college is free in Sweden.
“We spend half our time trying to find somewhere to live instead of thinking how do we create the next unicorn,” said Billy McCorman, president of the Stockholm Property Association, using the mythical horse as a euphemism for the next billion-dollar tech start up.
But even a unicorn may not be able to get Stockholm out of its housing crisis. Maybe they should take a page out of the de Blasio playbook. They’ll have tons of glittery skyscrapers that only the super wealthy can afford and 20 percent affordable housing thrown in for good measure. As for the middle class? There’s always their old bedroom at mom and dad’s.
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