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Land problems slow down housing construction in Stockholm for next year
Posted on January 8, 2024 |
The Stockholm County Administrative Board is worried that only around 6,000 homes may begin construction next year, a significant drop compared to the record-setting 2021.
To cope with reduced demand, prices for land suitable for building and quality standards for residential areas are being lowered.
High costs in many areas make building impractical, with some places requiring negative prices for building rights to make financial sense.
Even with free land, profitable construction projects are not possible in many parts of the county.
In central areas where higher rents or condo sales are viable, profits can still be made, but building rights have lost around 50% of their value on average.
The significant slowdown in construction raises concerns about increased bankruptcies, with Stockholm County experiencing a 33% rise in construction industry bankruptcies, reaching the highest levels in 15 years.