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Will Sweden’s Woes Shake Europe’s Real Estate Markets?
Sweden has become the poster child for European property-market volatility. The country’s residential property market has experienced one of Europe’s biggest booms and sharpest reversals in recent years. And Swedish commercial real estate (CRE) markets are facing oversupply, high vacancy rates and rising financing costs. As a result, the bonds of leading Swedish real estate companies have faced successive credit rating downgrades, sparking fears that CRE troubles will extend to banks and property companies across Europe. We disagree. In our analysis, Sweden’s banks and property companies are mostly well placed ... (full story)