Why rent control isn’t working in Sweden

DM

A shortage of accommodation in Stockholm and other cities, is causing a major headache for young Swedes — in a country which has been championing rent controls since World War Two. Rents are supposed to be kept low due to nationwide rules, and collective bargaining between state-approved tenant and landlord associations. In theory, anyone can join a city’s state-run queue for what Swedes call a “first-hand” accommodation contract. Once you have one of these highly-prized contracts it’s yours for life. But in Stockholm, the average waiting time for a rent-controlled property is now nine years, says the city’s housing agency Bostadsförmedlingen, up from around five years a decade ago. This wait-time doubles in Stockholm’s most attractive inner-city neighbourhoods. The traffic-jam has fuelled a thriving sub-letting or “second-hand” market, with “first-hand” renters and owners alike offering apartments to tenants for very high prices, despite regulations designed to stop people being ripped-off.

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