Stockholm’s city management office has produced a business cycle report, planning conditions for budget 2023–2025. It is not a cheerful read: rising commodity prices due to the war in Ukraine, high inflation, long-term unemployment that remains at a high level, families with children moving out of the city.
– Stockholm has positive factors to build on but households are much more pessimistic, many Stockholmers have high mortgages so it is clear there is a concern about higher interest rates. A package of Bregott costs SEK 62, food prices have become significantly more expensive, says Anna König Jerlmyr.
According to her, the city risks a situation where funds for preschool and elderly care instead go to capital costs. If the interest rate rises by one percent, it means 700 million more per year for Stockholm.
The city’s weak population growth – which worsens the tax base – is mainly explained by a negative net migration, which is due to both a reduced migration from abroad as a result of the pandemic and an increased migration to neighboring municipalities in the county and to other counties in Sweden.
In 2021, the negative net relocation against the rest of the county amounted to minus 10,458 people, which is a record high. Nacka, Haninge and Järfälla were the most common municipalities in the county to move to from the city of Stockholm.
This is largely explained by the large groups born in the late 80s and early 90s who are now reaching family-forming ages and looking for a larger home. In general, housing is larger in the other municipalities in the county and prices are lower.
– We have built too many ones and twos, there is a shortage of larger apartments, single-family houses and terraced houses. I am critical of how we negotiated with the state to have a metro expanded, when the city promises x thousand homes, there will only be one.
Anna König Jerlmyr thinks that we will see the townhouse’s revenge, both as tenancy, tenancy and ownership.
– We must be able to keep the families with children and also expand, for example, sports facilities, she says.
The investment plans for the municipal group over the next five years are still high and are estimated to amount to between SEK 20–21 billion per year. In addition, the city has commitments of over 10 billion in co-financing of state infrastructure projects to be paid by 2035.
Anna König Jerlmyr believes that it is necessary to prioritize.
– Everything may not need to be renovated at once and we should not start large projects without having proper calculations. We have examples of what we have done before, Liljevalchs and Medborgarhuset where the costs went down.
Stockholm will also sell more properties.
– The city owns a lot of office properties that others use, many properties that are not core business. These can be various commercial actors who rent out properties that the city does not necessarily need to own.
Another challenge for Stockholm is that the proportion of people over the age of 80 is expected to increase by just over 49 per cent over the next ten years, while the proportion of people of working age will increase much more slowly. This means increased competition for labor and that the future supply of skills for welfare will become increasingly difficult to solve.
But Stockholm’s possibilities to recovery are good, says Anna König Jerlmyr. According to SKR – Sweden’s municipalities and regions – a recovery in the economy can take place in 2023–2024.
– We have reduced our debt and strengthened our credit rating with the credit rating agency Standard & Poor’s, which means a long-term lower interest cost, says Anna König Jerlmyr.
She also wants to reduce the dividend from the group company Stockholms Stadshus AB to one that she believes is a long-term sustainable level.
– A sustainable development is that we withdraw 600-700 million. We must not base our policy on withdrawing money from the companies.
And you should not lower taxes if you win the election?
– We will not raise any taxes if we win the election. We always want to reduce the municipal tax if the economy allows, but it is too early to say. says Anna König Jerlmyr.
Read more:
Stockholm’s households view the economy gloomily
Housing crisis prevents companies from recruiting
Seven million for a detached house
A report issued by the County Administrative Board in 2021 states that for the third year in a row, net emigration increased from Stockholm to the rest of Sweden – just over 5,600 more emigrated than in 2020. The migration load went mainly to the neighboring counties Sörmland, Västmanland and Uppsala. It is mainly young people and people of family-forming age who move.
The homes on the other side of the county border – especially the detached houses – are simply cheaper and in combination with better commuting opportunities and increased opportunities for telework, many are moving. The county’s own detached houses are now a form of housing for people with very good finances. The average price today is SEK 7 million.
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