I was chatting with a close friend about apartment hunting in Stockholm and while at that moment, she was not enveloped in frustration she emailed me later on to tell me how she really felt about the Swedish rent system.
Her explanation is so spot on, I have to share it.
Well, here is how the apartment thing happens. Almost all of the apartments in Stockholm are run by the official queue system. No open market. This means, that the rent stays pretty low compared to other major US cities and cities around the world. There are a few private apartment buildings, but you pretty much need to know someone to get in (vacancies are rare). Sounds like it could be really nice, right? Well, it would be if it actually worked. Of course, everyone wants to live in the cities.
Housing in the city is limited – over the past ten years, they have started to build more, but it is a slow process – building brand new or converting factories still takes years to construct. Alas, this does not happen. So, problem 1: lack of housing.
Swedes are very into an area having it’s own grocery store, pharmacy, bolaget, etc. So whenever apartments go up in a “new” area, a whole mini-city has to be built if those amenities aren’t in close proximity. The issue is that the government did not build these mini cities in most neighborhoods. Problem 2: you have to travel to get essentials.
The apartment queue was started sometime in the 1960s. Anyone with a personal number could get in line for an apartment and obtain a first hand contract apartment at rent controlled prices, thus distorting real market prices. The geniuses that planned this decided to let ANYONE with a swedish social security number be in the queue. This resulted in people popping out kids and putting them in the queue right away before the kid was even 10 days old.
As a result, some people have been in this queue for 19 years, even though they were probably not even ABLE to rent an apartment for 17 years (the average wait time is 7 years). When these people are legally allowed to rent, they are obviously at the front of the line and can get an apartment in the city center without problems. Meanwhile, everyone from outside of Stockholm has to wait at least a few years to get an apartment in the queue. Problem 3: stupid, stupid queue system.
If you are able to get an apartment in the queue system after only a few years, it is probably in the suburbs. Swedish suburbs are the hood. The houses are hideous, for some reason that whole “nearby amenity” idea was completely lost when these places were built in the 1970s, back to Problem 2. You are likely to be at least 20 minutes by subway from the city center. And much of suburbs (förot) aren’t even on the subway (tunnelbanan) and are on the commuter train line (pendaltåg). Problem 4: the “available” apartments are in places no one wants to live.
So, all of this culminates into a very shady, illegal setup in the city that just seems to become more of a mess each year. First, if you are lucky enough to get your own apartment( förstahand kontrakt), you can sublet for up to one year at a time (searching on sites like Bostad Direkt). People who have these leases are usually thrilled to sublet because they realize how much money they can make. Hello, black market. Note, people who own apartments are also able to sublet for up to two consecutive years. Problem 5: A tier structure of owners (who buy the rights to live in the apartment), first hand renters (the ones we all hate), and drifters (normal people who cannot afford to buy and are at the bottom of the queue).
People who sublet often charge twice to three times the real rent of what the apartment. This is of course illegal, the markup for a furnished apartment from someone with a first hand contract is 15%. In reality, first hand rental owners write 10-15% more on the contract to satisfy the rent board and then off the books, demand the extra 100-200% markup in cash. Problem 6: Black market on monthly rents.
To make the rental situation in Stockholm even more insane, you can go to the rent board after you move out and sue the people you were renting from to get back the money that you were overcharged. Most people don’t do this because everyone realizes that’s just how it’s got to be.
Also, people started realizing the value of these leases and illegally selling them. “Selling” meaning asking for bribes (minimum 20,000USD) to turn the first hand contract over to a new person permanently. Problem 7: Bribery is normal.
The government cannot disassemble queue system and the communists-extreme socialists support the system. The companies that run the first hand queues around the country would balk at refunding everyone in the queue (costs about $50 per year to be in the queue). Instead, the individual renters looking for a place to live, are screwed. Problem 8: normal renters, mainly foreigner workers, newcomers, any regular person are entirely fucked.
We are able to stay for our year of the sublease. Fortunately the primary lease holder is honest and is doing everything very above board (we only pay about $730 for rent, illegal rate would probably be more like $1,150). The apartment that I am hoping (but not hopeful) that we get is a newly constructed apartment closer to the city. New apartment rents are quite expensive — which discourages people who’ve been in the queue for longer. It would be about $1200, but it would be ours and we could always try to trade leases.
This is the misery of trying to find a place in Stockholm!
Thank you AB for this caustic yet true summary of renting in Sweden.