Why is it so hard to find an apartment to rent in Stockholm?

Professionals who move to Stockholm to work and live here for a number of years are often struck by how difficult it is to find an apartment to rent, especially for more than one or two years. This is understandable, because the renting market in Stockholm is very different from other comparable cities.

So, why so difficult? There are a number of reasons due to the complexity of the market, but here are a couple of reasons I think stand out:

The demand is way higher than the supply

There’s always been a high demand for housing in Stockholm since the urbanisation began. The capital of Sweden is still where the jobs are and people keep moving here. At the same time the construction of new housing has plummeted the last couple of years, especially with the inflation of 2023, making it less profitable for construction companies to build apartments.

People live in their apartments

Most people that “own” their apartment have no other place to go if they wanted to rent it out for a number of years. That is to say less objects are then available to rent on the market. Furthermore, most “owners” of apartment don’t own the actual apartment, but a part of an apartment association (bostadsrättsförening). That means the “owner” needs a permission from the association to rent out her apartment, and usually the board is reluctant to have “unknown” people living in the building, especially for a long time (more than a year). So, even if you would “own” another apartment in an apartment association, you would still need a permission for that apartment. New regulations have been introduced recently that allows for true ownership of the apartment, but those are still a very small percentage of the market. All of this limits the supply of rental apartments.