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Swedish Government invests in housing sector

Housing a key priority in the 2016 Budget Bill

Stockholm, 24 September 2015 | Published in Economy
Photo: Jessica Gow/TT
Photo: Jessica Gow/TT

The Swedish Government presented its 2016 Budget Bill on 21 September. Investment aid for new rental properties and aid for municipal authorities to speed up residential construction are two of the proposals made in the Government’s budget, which will contribute towards achieving the target of 250,000 new homes by 2020. The Social Democrat-Green coalition is also proposing new aid for energy efficiency improvements and the renovation of multi-dwelling buildings and outdoor environments.

Officials comment that there is a serious housing shortage in Sweden. The market cannot resolve the housing shortage on its own, for which reason the state needs to assume greater responsibility for more dwellings being built. The Government therefore proposes several initiatives to stimulate increased residential construction, focussing on sustainable homes that can be afforded by people on normal incomes.

“Far too few homes are currently being built. The aid proposed by the Government may help to promote the construction of more rental properties at a time when there is an acute housing shortage in Sweden,” explains Kurt Eliasson, CEO of SABO, the Swedish Association of Public Housing Companies, a Housing Europe member organisation.

Investment aid for rental accommodation

Investment aid is being introduced for the construction of rental and student accommodation.

This support is aimed primarily at regions experiencing growth and is particularly generous for dwelling spaces of up to 35 square metres. In order to receive aid, the rent may not exceed a certain level, while the dwellings are to be energy efficient and allocated in collaboration with the municipal authority. The Government proposes to appropriate SEK 2.2 billion for 2016. Appropriations are estimated to be SEK 2.7 billion, SEK 3.2 billion and SEK 3.2 billion for 2017, 2018 and 2019, respectively.

Aid for municipal authorities

Aid to increase residential construction is being introduced for the municipal authorities. The municipal authorities can facilitate and speed up residential construction through initiatives as a planning authority, when processing building permit matters and in their role as property owner. The aid for municipal authorities is intended to foster a streamlined and more rapid way of working.

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Soil decontamination

The municipal authorities are offered an opportunity to apply for government aid for measures to remedy pollution damage. The current funding for decontamination and the reinstatement of polluted areas is being increased while it is also being extended to cover the after-treatment of land for residential construction.

Housing for older people

New investment aid is being introduced for housing for older people. This aid will stimulate the construction of new, and the renovation of existing, special housing and homes on the ordinary housing market intended for people over the age of 65. Aid will also be provided to encourage people to stay in their homes by making minor adaptations to communal areas. The purpose is to increase the amount of housing for older people and in that way improve accessibility and also increase opportunities for a sense of community and safety for older people.

More student accommodation

In order to provide a separate incentive for the construction of student accommodation, the Government intends to propose a further SEK 300 million in 2016 for the rapid erection of student accommodation.

Energy efficiency improvements and renovation work

Aid is being introduced for energy efficiency improvements and the renovation of multi-dwelling buildings as well as aid for the renewal of outdoor environments. This aid has been designated for measures in areas where there are socio‑economic challenges. Regarding the outdoor environment, this involves creating places for people to meet and increasing accessibility to basic services.