The turnaround in the housing market? Signs point to a stronger 2026

Erik Holmberg, market analyst at Hemnet, shares his view on the housing market's development ahead of 2026

During 2025, the recovery in the housing market slowed down, and development was weaker than we had anticipated. However, the uncertainty that characterized last year has dissipated, and there are now many indications of a stronger housing market in 2026.

The slowdown during 2025 is also visible in home buyers' views on price development, which fell clearly. Now in January, however, it has bounced back up again. The proportion of home buyers who believe in rising housing prices increased by just over 10 percentage points, to 43 percent – the largest increase in a single month since measurements began. This is likely largely connected to the news we received in December regarding confirmed regulatory changes linked to credit restrictions, and it confirms the picture of a stronger housing year in 2026.

When credit restrictions are eased in April, purchasing power in the housing market will be released. All else being equal, this also yields stronger price development. Other factors can of course have the opposite effect, but as it looks now, there is a lot else that also speaks for price increases and higher activity. The economic cycle and economic development are very important for the housing market, and even there, according to most forecasts, things look more positive going forward.

At the same time, it is important to remember that price increases are not necessarily positive – especially not for those outside the owned housing market, where rising prices are often perceived as frustrating. But price increases are simultaneously important for activity to increase on a broad front. The price decline has created a clear lock-in effect, and in 2025 the number of one-room apartments sold was almost 25 percent lower than the period before interest rates began to rise. At the same time, households remain sensitive to new unrest, which we saw when tariff threats and the risk of a trade war quickly affected expectations via inflation and interest rates. But given the conditions right now, the base forecast is still that the housing market will recover clearly, with rising prices and higher activity in 2026.