Sweden’s parliament, the Riksdag, approved legislation this week easing restrictions on mortgage loans, a move intended to bolster the housing market and aid prospective homebuyers. The changes, set to take effect April 1, include raising the loan-to-value ratio to 90 percent and eliminating a stricter amortization requirement.
The decision to increase the maximum loan amount to 90 percent of a property’s market value effectively lowers the required down payment from 15 percent to 10 percent. This adjustment aims to develop homeownership more accessible, particularly for young people and first-time buyers, according to a motion submitted by Markus Wiechel and Ann-Christine Frohm of the Sweden Democrats party. The Riksdag stated it expects the government to act on the motion.
Previously, borrowers with mortgages exceeding 4.5 times their gross annual income were required to make additional amortization payments. That requirement has now been removed. The government asserts this will provide financial relief to families seeking larger homes and ease the burden on existing homeowners. But, lenders will need to agree to amend existing loan terms for the change to take effect for current borrowers.
The changes come after a proposal by the government and the Sweden Democrats, with Finance Minister Niklas Wykman suggesting the move could lead to a modest increase in housing prices. A press release from the government on March 5, 2026, detailed the legislative changes, emphasizing the intention to facilitate both younger individuals entering the housing market and families needing more space.
While the new regulations remove the stricter amortization requirement, they also introduce limitations on extending existing mortgages. Additional loans will be capped at a loan-to-value ratio of 80 percent, aiming to curb overall household debt. SBAB, a Swedish mortgage provider, reported in December 2025 that the proposed changes were already generating interest among potential buyers.
The new rules will be governed by a new law, replacing existing guidelines from the Swedish Financial Supervisory Authority (Finansinspektionen). Handelsbanken noted in a recent analysis that the Riksdag is expected to finalize the decision in March 2026, paving the way for the April 1 implementation.
The legislation follows a period of debate regarding housing affordability in Sweden. The Riksdag’s decision to move forward with the changes comes as the country grapples with a shortage of rental properties and high housing costs, particularly in major cities.
