Stefan Ingves: Housing market challenges - weighing today against tomorrow

Speech by Mr Stefan Ingves, Governor of the Sveriges Riksbank, at Business Arena Stockholm, 18 September 2019.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Accompanying slides of the speech.

Today, I am going to talk about something that affects all of us: the housing mar-ket. Everybody needs somewhere to live, regardless of whether this need is tem-porary or more permanent. When the housing market functions well, people can find a home for every phase of their lives and it is relatively easy to find the kind of home they want and can afford. In addition, the development of prices is such that the differences between a person owning their home and one renting one are minor.

However, in Sweden, the housing market does not work well and has not for some time. This has contributed towards rising housing prices for an extended pe-riod. And this, in turn, has led to what I consider to be an unsustainable increase in household debt and has made both Swedish households and, ultimately, Swe-dish banks and Sweden's economy vulnerable. This is something that the Riks-bank and other actors have emphasised for many years.