What Broke Sweden? Real Estate Bust Exposes Big Divide
At the heart of the country’s economic and social crisis is a broken housing market, which has amplified social divisions While Sweden sits between France and Switzerland in a ranking of dollar billionaires, many poorer Swedes have seen the gap between the haves and the have-nots widen dramatically in recent times. The central bank views real estate lending as the biggest risk in the financial system and has warned about the impact of rising household debt on everything from consumption to bankruptcies and bank losses. It has repeatedly called for housing and tax reforms with former Governor Stefan Ingves criticizing the level of the property tax, which is among the lowest in the world. inflation over the past 12 months, interest rate hikes and a slumping currency. The fallout has triggered Europe’s worst house price collapse and a drop in household consumption. Even with the upheavals from the Ukraine war denting other European nations, Sweden is th...