Published by Uma Rajagopal
Posted on November 4, 2024
2 min readLast updated: January 29, 2026
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STOCKHOLM (Reuters) – Sweden should ease rules on mortgage borrowing and repayment which have made it harder for new buyers to get into the housing market, a government-appointed commission recommended on Monday.
STOCKHOLM (Reuters) – Sweden should ease rules on mortgage borrowing and repayment which have made it harder for new buyers to get into the housing market, a government-appointed commission recommended on Monday.
There is room to ease these measures without undermining financial stability,” the head of the commission Peter England told reporters.
The government will decide on how to adjust mortgage rules in the spring, Financial Markets Minister Niklas Wykman said.
Swedish households are among the most highly indebted in Europe – at around 190% of disposable income – and the current mortgage repayment rules, introduced after the financial crisis of 2008-2009, were aimed at reducing the related risks to the banking system.
They include a borrowing ceiling and rules over mortgage repayment for heavy borrowers, but they have been criticised for making it hard for first time buyers and for those without capital.
Heavily indebted households were also badly hit during the recent period of high inflation and high rates, amplifying a fall in consumption and the effect on the economy.
The commission recommended raising the borrowing ceiling to 90% of the value of a property from 85% and easing repayment requirements for higher borrowers.
However, the commission recommended that the government introduce an income component to borrowing rules, limiting mortgage loans to around 5.5 times households’ annual gross income.
(Reporting by Simon Johnson, editing by Anna Ringstrom and Hugh Lawson)
A mortgage is a loan specifically used to purchase real estate, where the property itself serves as collateral for the loan.
Financial stability refers to a condition where the financial system operates effectively, allowing for efficient allocation of resources and maintaining confidence in the economy.
A borrowing ceiling is a limit set by financial authorities on the amount of money that can be borrowed against a property, aimed at reducing financial risk.
Mortgage repayment rules are guidelines that dictate how borrowers must repay their loans, including payment schedules and minimum payment amounts.
Disposable income is the amount of money that households have available for spending and saving after income taxes have been deducted.
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