STEPS
Check Eligibility
- Non-Residents: A non-Swedish citizen can still buy property in Sweden, but a Swedish personal ID number (personnummer) is required for administrative purposes. Typically, this requires establishing residence in Sweden.
- Financing: A Swedish bank account may be necessary to secure financing. Some banks offer mortgages to foreign buyers, but the terms and rates can vary.
Determine the Budget
- Budgeting: It is important to determine how much can be afforded. Consider the cost of the house, taxes, and other fees (e.g., stamp duty).
- Mortgage: If financing is needed, meeting with a Swedish bank or financial institution is recommended. Swedish banks usually lend up to 85% of the home's value, so it is important to be prepared to cover at least 15% of the cost upfront.
Find a Property
- Online Search: Swedish property websites such as Hemnet (hemnet.se) and Blocket (blocket.se) can be used to search for available homes, with filters available for location, price, size, and other features.
- Real Estate Agents: Working with a local real estate agent (mäklare) is advisable. They can guide through the process and assist with negotiations.
View the Property
- Inspections: A property inspection is often scheduled to assess the condition of the house, including its structure, electrical systems, plumbing, and other aspects.
- Visiting the Property: If not located in Sweden, it may be useful to hire someone to visit the property on behalf, or a virtual tour can be arranged.
Make an Offer
- Bidding: In Sweden, sellers often accept multiple bids, and it is common for properties to sell above the asking price. It is important to make an offer that is competitive yet within the set budget.
- Contract: If the bid is accepted, a preliminary contract (köpekontrakt) is signed. A deposit of approximately 10% of the purchase price is usually required upon signing.
Complete Legal Formalities
- Property Purchase Tax: A property purchase tax (stämpelskatt) applies to property transactions in Sweden. For private homes, it is 3% of the purchase price or the tax assessment value, whichever is higher.
- Finalizing the Sale: After signing the preliminary contract, the buyer and seller agree on a final date for the sale. The remaining payment is made, and the property is officially transferred.
Register the Property
- Swedish Land Registry: After payment is made, the property must be registered with the Swedish Land Registry (Lantmäteriet) to legally complete the purchase.
- Insurance: It is advisable to obtain property insurance (hemförsäkring) for the home.
Move In
- Once all formalities are completed, the property is ready for occupancy.
ADDITIONAL CONSIDERATIONS
- Legal Assistance: While the process is generally straightforward, having a Swedish lawyer or notary involved to help with legal matters and ensure everything is in order is recommended.
- Maintenance and Utilities: Understanding local utility costs (e.g., electricity, heating) and the maintenance requirements of the property is important.
ADDITIONAL NOTICES
- Property Purchase Tax: A 3% property purchase tax applies to transactions in Sweden, based on the purchase price or the tax-assessed value.
- Personal ID: A Swedish personal ID number (personnummer) is required to complete the property purchase. Obtaining this typically requires establishing residency in Sweden.
- Offer Process: It is common for properties in Sweden to sell above the asking price due to competitive bidding.
In Sweden, real estate taxes are regulated by the government, and the rates can vary based on the type of property (residential, commercial, or land). The key types of taxes related to real estate in Sweden include:
Property Tax (Fastighetsskatt)
Sweden abolished the general property tax on residential properties in 2008, but there is still a property charge (fastighetsavgift) for residential properties based on their assessed value.
- For single-family homes or owner-occupied apartments, the annual property charge is capped at a fixed amount that is adjusted periodically to account for inflation.
- The property charge applies to the first residential property, but additional properties may be exempt from this charge.
- For commercial properties (e.g., offices, retail, industrial buildings), the property tax rate is 1.0% of the assessed value.
Capital Gains Tax (Kapitalvinstskatt)
When selling property, there may be a capital gains tax on any profit made (the difference between the sale price and the purchase price). The general tax rate is:
- 22% on the profit for individuals selling property in Sweden.
However, there are exemptions for the sale of a primary residence (boskatt). For instance:
- If a primary residence is sold and another one is purchased, it is possible to defer paying capital gains tax until the new property is sold.
Stamp Duty (Stämpelskatt)
Sweden charges a stamp duty on property transactions, which is typically paid by the buyer:
- 3% of the purchase price (or the assessed value, whichever is higher) for residential properties.
- 3% also applies to commercial properties.
Inheritance and Gift Tax (Arvsskatt och Gåvoskatt)
Sweden abolished the inheritance and gift tax in 2005. Therefore, real estate or other assets inherited or received as a gift are not subject to tax. However, capital gains tax may apply when the property is eventually sold.
Municipal Tax for Landowners
If land is owned in Sweden, municipal taxes may apply. The tax rate varies depending on the municipality.
Note: Tax rates and regulations can vary based on specific circumstances and location within Sweden. It is always advisable to consult a local tax professional for the most up-to-date information.