What broke Sweden? Real estate bust exposes big divide • Hacker News Board

Re: What broke Sweden? Real estate bust exposes big divide

#21

Post by joshuaissac » Sat, Apr 01, 2023, 9:51 PM UTC

varispeed wrote: post #14

ChuckNorris89 wrote: post #8

Earlier quoted context omitted.

Of course it doesn't. The only way to bring down prices is to build more supply than the demand, but for some reason this elephant in the room is always ignored because always a million reasons come up against it, mostly being just NIMBYsm in disguise. Keeping a limited supply artificially price capped through regulations, sounds good at first, and will most likely be popular with clueless voters, but it will lead to…

> but for some reason that route is never explored. The reason you are looking for is called corruption. There is a very strong lobby of landlords and the rich treating residential housing as a store of value. It offers better returns than keeping money in the bank and it is safer, especially if you are from a country where your assets could be in danger - it's much harder for foreign states to take control of the pr…

> The reason you are looking for is called corruption.

It could just be democracy. Homeowners are an important vote bank and they generally want house prices to rise. A government that substantially increased housing supply would cause house prices to drop, which would make homeowners unhappy.

Re: What broke Sweden? Real estate bust exposes big divide

#22

Post by bilbo0s » Sat, Apr 01, 2023, 9:56 PM UTC

ChuckNorris89 wrote: post #20

belorn wrote: post #16

It should not be a major surprise that the gap between the haves and the have-nots will widen if you have a large compareable influx of have-nots, or to speak more precisely, an influx of new citizens with low social-economic status compared to those who already were ctiziens. In a very dispassionate perspective, it is just plain math. It is going to take time to return back to the same levels as before.

>if you have a large compareable influx of have-nots I'm not in Sweden but why are we always pointing the finger at the poor immigrants? Do you think there are no native Swedes being fucked by this real estate market? Granted, having an open borders migration policy is not a good idea when you have a housing shortage. If you're struggling to provide for the locals, then the newcomers will have it even worse and won't…

So true.

Immigration is an entirely separate issue. Conflating it with the fact that hard working Swedes can’t secure good housing only serves to make those Swedes, who are already pissed off, more pissed off. It’s bringing the masses closer to taking to the streets with calls for Madame La Guillotine.

Housing needs to be fixed asap in Sweden. (And in most of the western world if we’re being honest.)

Re: What broke Sweden? Real estate bust exposes big divide

#23

Post by ChuckNorris89 » Sat, Apr 01, 2023, 9:57 PM UTC

tpmx wrote: post #12

sgt wrote: post #4

Sweden is broken? That's news to me. Why isn't this in the media?

Young people are upset they can't live centrally in the capital for cheap. Same story as everywhere else. Now go forth with the ritual flogging, er, downvoting. (I live and work in the countryside of Sweden. I recommend it.)

Sure, but try dating and building social circles while living in rural areas as a single 20-30 something year old.

Of course young people want to live in dense walkable areas where it's easy to find other like minded people.

Isn't Swedish population also statistically one of the biggest sufferers of loneliness in the world and also one of the largest consumers of antidepressants? Or was that Finland? I'm not sure.

Re: What broke Sweden? Real estate bust exposes big divide

#24

Post by ambientenv » Sat, Apr 01, 2023, 9:59 PM UTC

ChuckNorris89 wrote: post #6

Real estate can either be a lucrative investment or it can be affordable. Why are people continuously acting shocked when they realize it can't be both? And why are elected politicians everywhere continuously shrugging their shoulders as if the housing market is somethin completely outside of their control.

We somehow have this belief that the "market" is some immutable law of nature like say, gravity. The "market" is based on behaviour, albeit behaviour that is heavily manipulated and controlled (somewhat invisibly - complicity or otherwise - to, seemingly, most people). We acquiesce and, when life is good for us, ignore the fact that we have to the power to change our behaviour and our beliefs and values and, thus, the market. But that will take hard work over time and much sacrifice. And so it goes ...

Re: What broke Sweden? Real estate bust exposes big divide

#25

Post by bugglebeetle » Sat, Apr 01, 2023, 10:01 PM UTC

xapata wrote: post #18

ChuckNorris89 wrote: post #6

Real estate can either be a lucrative investment or it can be affordable. Why are people continuously acting shocked when they realize it can't be both? And why are elected politicians everywhere continuously shrugging their shoulders as if the housing market is somethin completely outside of their control.

Suppose a large, publicly listed real estate investment trust (REIT) owned a diversified portfolio of housing across the country and operated it all as rental housing. Tenants could buy shares in the REIT and thereby invest not only in their own house, but all the others as well. Less risk and more flexible than home ownership. The downside for tenants is not being able to renovate. The upside is not being responsibl…

Imagine the state did this instead using taxes and eminent domain. Congrats, you’ve invented Vienna, one of the most beautiful cities in the entire world.

Re: What broke Sweden? Real estate bust exposes big divide

#26

Post by [deleted] » Sat, Apr 01, 2023, 10:02 PM UTC

xapata wrote: post #18

ChuckNorris89 wrote: post #6

Real estate can either be a lucrative investment or it can be affordable. Why are people continuously acting shocked when they realize it can't be both? And why are elected politicians everywhere continuously shrugging their shoulders as if the housing market is somethin completely outside of their control.

Suppose a large, publicly listed real estate investment trust (REIT) owned a diversified portfolio of housing across the country and operated it all as rental housing. Tenants could buy shares in the REIT and thereby invest not only in their own house, but all the others as well. Less risk and more flexible than home ownership. The downside for tenants is not being able to renovate. The upside is not being responsibl…

[deleted]

Re: What broke Sweden? Real estate bust exposes big divide

#27

Post by tpmx » Sat, Apr 01, 2023, 10:04 PM UTC

ChuckNorris89 wrote: post #23

tpmx wrote: post #12

Earlier quoted context omitted.

Young people are upset they can't live centrally in the capital for cheap. Same story as everywhere else. Now go forth with the ritual flogging, er, downvoting. (I live and work in the countryside of Sweden. I recommend it.)

Sure, but try dating and building social circles while living in rural areas as a single 20-30 something year old. Of course young people want to live in dense walkable areas where it's easy to find other like minded people. Isn't Swedish population also statistically one of the biggest sufferers of loneliness in the world and also one of the largest consumers of antidepressants? Or was that Finland? I'm not sure.

There are plenty of more affordable, densely walkable city areas in Sweden. Every single city in the country is built this way, from the smallest to the largest. That's not the factor.

The factor at play here is that these all these people want to have a cheap apartment in the same 10 km^2 that's designated as the cool place. When that can't happen because of physics, they claim society is breaking down.

> Isn't Swedish population also statistically one of the biggest sufferers of loneliness in the world and also one of the largest consumers of antidepressants?

No idea, but it sounds a bit like reverberations from Dwight D. Eisenhower's 1960 speech where he said that "sin, nudity, drunkenness and suicide" in Sweden were due to welfare policy excess, which then quite incorrectly caused americans to correlate Sweden with suicide and depression for many decades.

At the moment the suicide rate is higher in the US than in Sweden but we're relatively similar in this statistic.

https://ourworldindata.org/grapher/death-rate-from-suicides-...

Re: What broke Sweden? Real estate bust exposes big divide

#28

Post by jjoonathan » Sat, Apr 01, 2023, 10:05 PM UTC

ChuckNorris89 wrote: post #8

nivenkos wrote: post #7

The main problem is the terrible rent control system - with a lucky few getting rent-controlled first-hand contracts, and everyone else facing a cut-throat almost completely unregulated market of sub-letting. Rent control never works.

Of course it doesn't. The only way to bring down prices is to build more supply than the demand, but for some reason this elephant in the room is always ignored because always a million reasons come up against it, mostly being just NIMBYsm in disguise. Keeping a limited supply artificially price capped through regulations, sounds good at first, and will most likely be popular with clueless voters, but it will lead to…

Misguided handout-seeking poor are not stopping construction. Rent control doesn't solve the problem, but it doesn't cause the problem either.

> NIMBYsm in disguise

Yes, this is the real problem: the same capitalist incentive structure that pulls forward the future returns of a new housing investment also pulls forward the consequences of future supply normalization onto current owners. Capitalism also guarantees that these owners are the ones with power. It gives them the means and the motive to torpedo new development. So they do.

Capitalism causes NIMBYism. Which is the real problem.

Re: What broke Sweden? Real estate bust exposes big divide

#29

Post by patall » Sat, Apr 01, 2023, 10:10 PM UTC

Not sure about the main story about the article. However, construction on that Ursvik/Rinkby construction site has been very slow since long before the current crisis. I was biking through the neighboring bridge of the one mentioned here (that is about 100m down the road, so much about that new bridge alone enabling crime) for about 8 month and while my way through changed a few times, progress was very slow. (Not that any of the many many construction projects in Stockholm has been fast). What the article misses is that the Swedish Krona has lost more than 10% compared to the Euro over the last year and that, while theoretically making exports more valuable, increase inflation for all import products. Which for me as an immigrant is the main economic flaw in this country: it should have adopted the Euro like Finnland or at least locked the exchange rate like Denmark. But no, false national pride has now made the entire economic down-turn even harder.

(One should also note that mortage rate here in Sweden are still surprisingly low. My 3 month fixed rate right now is 3.65% of which I get back 30% via taxes. Hence I am effectivly borrowing at 2.5%)

Re: What broke Sweden? Real estate bust exposes big divide

#30

Post by xienze » Sat, Apr 01, 2023, 10:10 PM UTC

bilbo0s wrote: post #22

ChuckNorris89 wrote: post #20

Earlier quoted context omitted.

>if you have a large compareable influx of have-nots I'm not in Sweden but why are we always pointing the finger at the poor immigrants? Do you think there are no native Swedes being fucked by this real estate market? Granted, having an open borders migration policy is not a good idea when you have a housing shortage. If you're struggling to provide for the locals, then the newcomers will have it even worse and won't…

So true. Immigration is an entirely separate issue. Conflating it with the fact that hard working Swedes can’t secure good housing only serves to make those Swedes, who are already pissed off, more pissed off. It’s bringing the masses closer to taking to the streets with calls for Madame La Guillotine. Housing needs to be fixed asap in Sweden. (And in most of the western world if we’re being honest.)

> Immigration is an entirely separate issue. Conflating it with the fact that hard working Swedes can’t secure good housing

How do you figure the two are unrelated? The native poor are competing with an influx of poor immigrants for the same pool of housing. I find it hard to understand how those same poor natives would be worse off in terms of housing prospects if the immigrants never showed up, all things being equal. Immigration is never 100% of the reason behind housing issues, but it’s more significant than most people want to admit.