Government presents new housing proposals as part of spring budget

The centre-right coalition government presented a new section of their spring budget, due to be released next week, that deals with housing.

A month ago, a study showed that real estate companies have lost faith in the government's housing policies.

Today the government's leaders held a press conference at the newly built housing area of Annedal in the Stockholm suburb of Bromma today. They announced plans to spend around 800 million Swedish kronor of its budget in 2013 to implement changes in the property market.

One suggestion is to reduce the property fee for apartment complexes from 0.4 to 0.3 percent in order to stimulate the building of more homes.

Increasing mobility in the housing market is also part of the proposal, which would be achieved by making changes to the regulations for renting out private homes, such as allowing private home owners to rent out their property without permission from housing co-operatives.

According to the government's suggestions, tenants could pay off the home owner's mortgage as rent. If the home owner does not pay a mortgage, the amount of rent paid would be agreed upon between the two.

Stockholm's chamber of commerce supports the Swedish government's proposal to make it easier for private home owners to rent out their property, reports news agency TT. According to the chamber's estimations, it could create up to 20,000 new rentals.

If put into practice, these changes could push down housing prices, according to TT. The suggestions to make it easier for people to rent property from private home owners would give people an alternative to buying property, which could lower the value of owning property.

However, it is uncertain that prices would be significantly lower. In the long run, more rental properties on the market could have the opposite effect on property prices, as owning property would become more attractive.