Top five Nordic cities to buy into...
Top five Nordic cities to buy into.
Stavanger has seen prices fall, but is predicted to bounce back strongly
The secret’s out: Nordic countries are a cosy proposition for investors.
Has anybody not fallen head over cable-knit-sock-clad heels in love with the Nordics? In the past couple of years, we’ve been wooed by a lifestyle that adds up to little more than oversized jumpers, open fires, rustic wood stacks and piles of blankets in varying shades of cream.
There are, in fact, plenty of reasons why we should be looking to our Scandi neighbours for sanctuary right now, but none of them involves hygge or retreating to a candle-lit cabin. In an increasingly uncertain world, they offer something far more comforting than cosiness: economic and social stability, based on the less snug, more Viking-like elements of the Nordic way.
Did you know that there’s no usable word for “please” in Norwegian? Or that tact as a concept is not openly recognised, and the locals do not believe in even the lightest of sugar coatings? The Scandinavians are direct when it comes to business deals and negotiations. They say what they mean and they mean what they say. And this straightforward transparency has stood them in good stead.
It also makes them an attractive investment opportunity. “We are very open,” says Agneta Jacobsson, head of Sweden and the Nordics at the property consultancy Cushman & Wakefield. “Buying a home is clear and simple here.”
The region’s residential property sector is looking ever more attractive against the backdrop of increasingly erratic markets elsewhere in Europe. A word of warning, though: Scandinavia may be safe, but it is not cheap. Prices in central Stockholm can hit £8,000 a sq metre, and they are nearing £6,000 a sq metre in the heart of Oslo.
That said, there are less expensive deals to be had away from the prime central spots — and for those with some cash to splash, they could offer a timely haven right on the doorstep. The trick is knowing where to invest for the best deals and the strongest returns.
Here is a guide to the top five Nordic cities to be eyeing in 2017.
Oslo
Wealthy Norway has finally decided to open for business. One of the richest countries in the world, it has started actively courting foreign investors. “Ten years ago, Norwegian real estate was very local,” says Stig Bech, partner at the Oslo-based law firm BA-HR. “But that has changed in the past five years, as we have realised international investment makes us more robust.”
Wealthy Norway has finally decided to open for business. One of the richest countries in the world, it has started actively courting foreign investors. “Ten years ago, Norwegian real estate was very local,” says Stig Bech, partner at the Oslo-based law firm BA-HR. “But that has changed in the past five years, as we have realised international investment makes us more robust.”
The capital city is a great entry point for UK buyers interested in snapping up a pad in the land of the fjords. At about £6,000 a sq metre, residential property in
central Oslo is close to London prices, but costs drop to £2,500-£3,000 per sq metre on the fringes. There’s also an influx of new stock coming onto the market, which could stabilise the average 8% price growth the city has seen over the past two years.
central Oslo is close to London prices, but costs drop to £2,500-£3,000 per sq metre on the fringes. There’s also an influx of new stock coming onto the market, which could stabilise the average 8% price growth the city has seen over the past two years.
New schemes such as the 220,000 sq metre waterside Barcode Project, which is 20% residential, have opened the floodgates to a new style of high-end modern architecture, and the city has large-scale regeneration plans that will involve building 147,000 homes in the next two decades. So there will be plenty of opportunities to get in on the Oslo boom.
Stavanger
This is the main hub for Norway’s oil industry, so it is fairly obvious that the sharp fall in commodities prices have had some serious implications. House prices in Stavanger have been falling as a result — by 8% from 2015 to 2016 alone. Buying here is obviously riskier than investing in a strong performer such as Oslo, but for anyone deterred by the high Nordic prices and prepared to wait a while for a return on their investment, the fjordside city is well worth a look.
This is the main hub for Norway’s oil industry, so it is fairly obvious that the sharp fall in commodities prices have had some serious implications. House prices in Stavanger have been falling as a result — by 8% from 2015 to 2016 alone. Buying here is obviously riskier than investing in a strong performer such as Oslo, but for anyone deterred by the high Nordic prices and prepared to wait a while for a return on their investment, the fjordside city is well worth a look.
“Stavanger could end up being a bit like Ireland,” says John Solberg, managing director of the property agency CBRE in Norway. “When the market bounces back, it will recover quickly, and, as with Ireland, people will wish they had invested or bought property when prices were low.
“Everyone is worried because of the oil, but the city will survive. Now is the time to find good deals.”
Stockholm
This fresh, understated city has a utilitarian attitude that is straightforward almost to the point of indifference. Far from being unwelcoming, though, the local penchant for erring on the side of the aloof only adds to the relaxed vibe.
This fresh, understated city has a utilitarian attitude that is straightforward almost to the point of indifference. Far from being unwelcoming, though, the local penchant for erring on the side of the aloof only adds to the relaxed vibe.
Stockholm also happens to be one of the strongest property performers in Scandinavia, and there are big plans for new developments, too. More than €36bn of residential construction started in the city last year, and the plan is to add 140,000 homes by 2030.
Foreign buyers should be able to get in on the action, as long as they have money to spend and understand the intricacies of the market. Property prices away from the prime central hotspots hover at about £4,000 a sq metre, and a two-bedroom property can be let for about £1,500 a month, according to Jacobsson.
On the buy-to-let side, bear in mind that it is much easier to rent out a house than an apartment here: flats in Stockholm are often part of local-authority-owned developments where rent caps apply and permission is needed before individual units can be let.
Gothenburg
All the benefits of the straightforward Swedish market, without the Stockholm price tag — in this creative, chilled-out city on the country’s west coast, property is likely to cost nearer £2,500 a sq metre. Gothenburg has two universities — one of them the largest in Scandinavia — which fuels a young, vibrant population. Famed for cheap street food and independent coffee shops, it’s perfect for anyone after a relaxed Swedish bolthole. And now’s the time to make a move.
All the benefits of the straightforward Swedish market, without the Stockholm price tag — in this creative, chilled-out city on the country’s west coast, property is likely to cost nearer £2,500 a sq metre. Gothenburg has two universities — one of them the largest in Scandinavia — which fuels a young, vibrant population. Famed for cheap street food and independent coffee shops, it’s perfect for anyone after a relaxed Swedish bolthole. And now’s the time to make a move.
“For a long time, this has been quite a closed market,” Jacobsson says. “There was a lot of family-owned property tied up off the market, but that has changed over the past 18 months. Things have opened right up — family companies are selling off stock because they realise the city needs investment from outside the Gothenburg region. And there are huge expansion plans for the city, which will see a lot of new stock coming on line.”
Helsinki
The ninth best city in the world in which to live, according to the Economist Intelligence Unit, the Finnish capital is known for its impressive healthcare and education provision, a strong cultural offering and well-oiled infrastructure. Property prices in Helsinki hover at about £3,000 a sq metre in the city centre, but you get more bang for your buck here than in Sweden or Norway.
The ninth best city in the world in which to live, according to the Economist Intelligence Unit, the Finnish capital is known for its impressive healthcare and education provision, a strong cultural offering and well-oiled infrastructure. Property prices in Helsinki hover at about £3,000 a sq metre in the city centre, but you get more bang for your buck here than in Sweden or Norway.
The city is expecting an influx of about 40,000 new residents between now and 2021, and Finland is actively encouraging overseas buyers to invest. If you are looking for a buy-to-let investment, it pays to think small. The bigger flats in Helsinki don’t bring in high returns, but a property with 60 sq metres of living space will provide a yield of about 5%.
Emily Wright is the global editor of Estates Gazette
Properties for sale
Oslo £460,000
This two-bedroom flat is at 11 Vibes Gate, in leafy Majorstuen, a fashionable neighbourhood with trendy restaurants, galleries and characterful shops. Built in 1892, the building was upgraded in 2007, with new kitchens and bathrooms. It’s within walking distance of the 110-acre Frogner Park. 00 47 95 041071, sem-johnsen.no
This two-bedroom flat is at 11 Vibes Gate, in leafy Majorstuen, a fashionable neighbourhood with trendy restaurants, galleries and characterful shops. Built in 1892, the building was upgraded in 2007, with new kitchens and bathrooms. It’s within walking distance of the 110-acre Frogner Park. 00 47 95 041071, sem-johnsen.no
Stockholm £590,000
There’s a Broooklyn feel to this three-bedroom flat in the heart of SoFo (“South of Folkungagatan”), a hipster area in Sodermalm. The recently renovated 940 sq ft apartment has period details with contemporary twists; the building dates from 1927 and has a communal laundry room, patio and bicycle storage. 00 46 708 564514, www.fantasticfrankrealestate.com
There’s a Broooklyn feel to this three-bedroom flat in the heart of SoFo (“South of Folkungagatan”), a hipster area in Sodermalm. The recently renovated 940 sq ft apartment has period details with contemporary twists; the building dates from 1927 and has a communal laundry room, patio and bicycle storage. 00 46 708 564514, www.fantasticfrankrealestate.com
My Scandi love affair
I first visited Scandinavia at the age of eight, when I went with my family to spend the summer with friends in Sweden. The long days were spent in an idyllic cluster of rustic red and white cottages by a lake in Dalarna, north of Stockholm. Twenty years on, I met my Swedish husband and moved to Malmo, which has been my home for more than a decade. My love affair with Scandinavia lives on.
I first visited Scandinavia at the age of eight, when I went with my family to spend the summer with friends in Sweden. The long days were spent in an idyllic cluster of rustic red and white cottages by a lake in Dalarna, north of Stockholm. Twenty years on, I met my Swedish husband and moved to Malmo, which has been my home for more than a decade. My love affair with Scandinavia lives on.
It didn’t take me long to appreciate the ease with which the Scandinavians create beautiful homes, applying their innate sense of style. Their interiors are renowned for their clean lines and muted colours, for being aesthetically pleasing yet at the same time highly functional.
Whether it’s a house by the sea in southern Sweden, an apartment in the heart of Copenhagen or a country home on an island overlooking the Oslo Fjord, in Norway, they are all incredibly well insulated in order to stay warm during the long months, when temperatures plummet. Scandinavia’s short winter days give rise to a yearning for natural light, which accounts for the preference for light wood floors and white walls and ceilings, as these reflect light around the home. And when the sun dips beneath the horizon, these homes glow with dimmed lights and the warm glow of flickering candles.
In keeping with the Scandinavian love of nature, interiors are often layered with natural materials such as wood, leather, sheepskin, linen and wool, which break up the clean lines while adding texture and warmth. During vacations, Scandinavians take the opportunity to enjoy nature first-hand in simple cottages and cabins by the sea or a lake, or in the mountains. Rural retreats are typically stripped back to the bare essentials. Some even lack running water and electricity, while others are a little more modern. But the goal is always the same: to be somewhere with few distractions and to lead a simpler life, surrounded by the tranquillity of nature and the people you love, just as I experienced all those years ago.
It’s a mindful, uncluttered lifestyle, and one that aligns well with modern thinking about sustainability. In many homes — be they urban or rural dwellings — you will find only a few beautifully crafted, high-quality design pieces, antiques and flea-market finds made from natural, sustainable resources. All are objects that will stand the test of time.
The Scandinavian Home by Niki Brantmark will be published on April 18 (CICO Books £19.99); myscandinavianhome.com
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