
Stockholm’s Home Shortage Could Stifle Startups - wallflower
http://www.nytimes.com/2014/12/15/technology/stockholms-housing-shortage-threatens-to-stifle-start-ups.html
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wahsd
Please someone explain something to me regarding the tech sector and housing.
Why is it that the most location independent sector, tech workers, are
huddling around certain urban areas? It makes absolutely no sense.

Shouldn't tech workers or even just simply technology savvy people be able to
work anywhere that has fast internet? So why is that community not living in
the countryside or in small spread out concentrations, instead of everyone
having to pile into certain cities?

~~~
wallflower
As someone once described to me, if you have a lot of money, the world's great
cities, London, NYC, LA, Hong Kong are your playgrounds. Living, working, and
playing within a walking distance or transit-friendly distance is strongly
becoming an aspiration for those who have the skills or money to afford it.

If you make $300-400K/year in New York City, you can afford to live a little.
Midtown or Chelsea apartment. Nice restaurants. Drinks in bars. $7 lattes.

~~~
techsupporter
This is exactly it for me. I don't live to work, I work to live and I want to
have interesting, dense, urban things as near to me as I can manage. My salary
isn't as high as some around here but I still pulled off buying a cute,
compact house smack in the middle of Seattle near 24-hour transit service and
minutes to everything I want to do. That's after moving from the suburbs of
Texas where anything besides a 7-11 or a Cici's Pizza were at least a
15-minute drive (and you could forget going via transit).

Humans are social creatures and we want to be around other people. That's a
generalization that usually holds true. Some people do want to live in a rural
setting, with acres of land separating them from their neighbors. A coworker
of mine does that and is quite happy with it. There just happen to be more of
us, apparently, who want the urban environment.

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gatsby
"[Almost any city with a real tech presence]'s Home Shortage Could Stifle
Startups"

Sama's tweet from about a month ago really resonated with me: "it's so
unbelievably frustrating how hard it is to get lots of new housing built in
the bay area. this one thing would solve so many probs."

There are so many factors at play here, but it mostly boils down to politics.

As more entrepreneurs start tacking big problems with lots of red tape (i.e.
banking, brokerage, medicine, insurance, etc.), I wish more people would look
to housing and how to keep costs sane.

PS - email me if you're in the space or have ideas. Real estate entrepreneur
here. Would love to hear ideas, give my opinion, or chat about possible
solutions.

~~~
santacluster
It's easy to blame politics, but those politics are based in social reality.

"Keeping the costs sane" for tech workers would mean putting the housing out
of reach of many ordinary people.

There is a finite amount of space, and the reason why housing scarce in many
cities in Europe is because a large portion is reserved for rent controlled
social housing (which unlike the US isn't just the extreme low end).

Not doing that clearly doesn't work either (see SF), and has so many negative
social side-effects that are unacceptable in Europe, so you don't even have to
bother trying to suggest it.

It simply comes down to too many people wanting to live where there's not
enough space. To solve that, you have to look at social factors, not
bureaucracy and real estate.

Personally I would suggest looking at the people who actually wouldn't mind
getting out of those cities but currently can't for various social and
economic reasons. Ironically, those are not the tech workers who could at
least theoretically work remotely.

~~~
marcusf
Not to discard your comment, but wrt Stockholm: Build higher! Urbanize areas
outside of the core inner city. Lots to do in planning and building to not
create artificial social policy.

~~~
santacluster
Has been done in many European cities in the 60's and 70's. Those are now
places nobody wants to live anymore, and many of them have been torn down.

The only people who want to live "higher" are the people who want high end
apartments in the inner city. And those are the places where height
restrictions are there to protect the historical nature of the inner city.

~~~
marcusf
I think it's a mistake to compare Le Corbusier-style "areas for living" with
modern urbanised zones. The big issue there is that – sure – there's
highrises, but no urbanisation. Usually because they are either lacking
commercial space on ground floors or the density is too low, on aggregate, or
the areas are too spaced out to support vibrant commercial centers. Look at
stockholm, you have city, greenery, suburb, greenery, suburb. No urban
connection, not enough density.

I've lived in areas like this myself, and I agree they're not nice. However, I
have to think it's not only locality to city center that makes central areas
good, it's also that they are self sustaining burrows. There's ample housing,
parks, jobs, retail, restaurants, bars, etc.

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mclemme
Lived in Stockholm for ~1½ years, ending in the spring of 2013.

Was lucky enough to have the company I was recruited for help me by having
their name on the rental agreement, covering any expenses the owner might have
if I thrashed the place, didn't pay rent, etc. Ended up finding a place for
13.000SEK/month on the outskirts of Stockholm, at the very last subway stop.

For most of the employees starting at the same time as me, most of their
rental agreements were only valid for a year or so (and the owner could kick
renters out pretty much at any time), forcing people to go and find other
apartments, which is not easy when the employer no longer offers support with
the contract.

One colleague of mine found that his response rate was extremely low on his
bot that automatically applied for an apartment, which matched his criteria,
as soon as it came up online. He suspected his non Swedish sounding name was a
factor, so he changed the name in the message to something Swedish-y ("Sven
Karlsson" or smth. like that) and instantly the response rate rose
dramatically. As a foreigner, not having anyting on your Swedish credit report
doesn't help either.

~~~
lingoberry
Yikes, I'm sorry for your experience. I think highly skilled foreigners coming
to Sweden to work is such a recent that society is lagging behind. I've heard
many stories of people changing their last names to their husband/wife's in
order to get job interviews etc. I hope as time goes on people will be more
accepting.

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firloop
It's basic supply & demand that rent control causes housing shortages. If rent
control was replaced with adequate rent subsidies for landlords (for the
lower/mid class tenants) and some of the more draconian regs were eased, this
problem would be solved overnight. Politically however, this is probably
impossible and/or extremely controversial, but I believe this arrangement
would be better for all tenants.

~~~
malandrew
Yup. Simply disassociating the benefits of rent control from the housing unit
it is attached to would go a long way to permitting development. The way
things are today, rent control basically serves as an almost permanent mutex
on the development of the underlying real estate.

I'd be more useful if cities made it a policy that the amount of housing
subsidy you receive is proportional to the year you moved to the city. That
would achieve the same goal as rent control (i.e. affordable housing), but
alleviates the mutex on many structures that could be torn down to make way
for structures that permit great density.

Affordable housing programs are fine. Tying up the underlying asset
indefinitely is counterproductive.

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tegeek
An average 80 sqm 3 rooms apartment in Stockholm rents about 6800 kr/month (a
bit less than 1000$ approximately). But you can only get this if you are in
rental queue. This is the money that any working person (doesn't matter a
software developer or electrician, plumber or car mechanic) can pay easily.

The rental queue works like first-comes first serve basis. And the first-come
means whoever registered first on the rental queue site. The main queue is
maintained by Stockholm State. There is no way for anyone to pay more money
and get ahead in queue.

Apart from that, there are always new buildings which have no queue but rent
is more (40 or 50% more than usual. Anyone who is willing to pay that amount
can get an apartment within 2 months time frame.

Then there is a 3rd black market. A lot of people sublet there for shorter and
some for longer terms.

Having said that all, I've thought about this problem but couldn't come to the
prefect solution. When state controls the rents & the process renting, it
gives guarantee to low-income families that they can also live in nice
neighborhoods.

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callesgg
There is a shortage of apartments up for rent, but not if you want to buy.

This is due to the fact that the Swedish home rental market is controlled by
laws and regulation.

To get an apartment in Stockholm get a loan buy the apartment pay your loan
interest + electrical bills and such.

It is in the end cheaper than renting and has other benefits aswell, and some
disadvantages to... There is loads of factors.

~~~
lingoberry
This is the biggest problem. There really is no rental market to speak of, so
talking about rental queues being 10 years long is not really relevant. If you
want to live in Stockholm for a longer time you need to buy. This also means
it takes months and months getting your loan approved, finding an apartment
and waiting to move in. Only the waiting to move in part can take more than 3
months.

The flip side is, once you've bought a place, it can be really really cheap to
live in with the current interest rates. We pay less than $1000 for a two
bedroom in central Stockholm for instance, all included (interest, fees,
electricity, water, heating, tv, broadband). This also means absolute prices
are insanely high, and will probably continue to rise since there's still room
for it to grow.

~~~
seivan
Months of getting your loan approved? At _MOST_ its takes a week. This is also
been the subject of many issues connected to the rising prices. Low interest
rate == easy loans dishing out.

It takes more time to actually find a decent place you like than to secure the
loan. That took a month for us. We saw 30 apartments.

Btw bids on two apartments. One was a low ball and they didn't want it. The
second one the price rose 200k (SEK) before I won.

~~~
lingoberry
No, I didn't mean it takes months to get your loan approved for most people.
It did for us though, since we moved from abroad, having no work history in
Sweden and no jobs at that point. That means you have to get two job offers
first (for a couple) and that takes time. During this time you are looking at
apartments but can't bid since you haven't secured a loan. Then comes the
looking part, which for us took maybe 2 months. There was a lull in
availability (and extreme competition between bidders), and we were outbid for
everything. When we finally found one, and outbid another couple (price rose
700SEK btw), we had to wait another 3 months to move in.

Everybody's experience is different, but I think we can agree this is madness
and not good for our economy. I rarely have much positive to say about the US,
but one thing is that you can literally go to almost any city (except maybe SF
and NYC), live in a hotel, and within a week you have found some place to
live. Might not be the highest standard of living, but you can always trade
up.

~~~
seivan
I had the same experience as you in terms of previous work history. I just
moved back to Sweden and had approx 1 month job history (and not even full-
time but a trial). Got my loan approved in a single day. Called back a week
later to expand the amount I wanted to loan.

I got the "lånelöfte" (guarantee to loan) from the bank in a single phone call
which allowed me to bid.

May I ask what bank you went to? I can add that I had the necessary 15% but
outside the country.

They never asked about it, nor previous work history.

Also, I don't have a Swedish name if you were wondering :-)

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dashboardfront
Same housing problems in Copenhagen. I'm a student who just lives back in my
home country and flies over to Copenhagen for exams because I couldn't find
housing. If I want to get something, I have to be there so I can hunt down
people in person. There's really no sort of easy way to just get an apartment
room, and I've found that willing to pay more doesn't really help (though
maybe if you're willing to rent out something for 3-4k USD a month + drop
12,000 on a deposit you might have better luck).

~~~
mclemme
Where are you from? And are you studying something that you can get SU from?
There are special student housing (called "Kollegium" rooms) in Denmark, where
only students are allowed to live. And the rent is considerably lower than
normal rental apartments.

It's been a while since I've studied, so my information might be outdated, but
feel free to send me an email if I can help in any way. I live in Copenhagen.

~~~
dashboardfront
I'm from the US. I've signed up for kollegiums and I'm waiting on the list.
It's taking a while as all the first year students have priority first, but
that's wearing off soon. Hopefully that'll come through soon, but it's going
to pose another challenge as I'll be going on exchange in half a year.

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seivan
Shameless plug, but my current tenant might eventually move out soon and I am
looking for someone else to take over once he leaves (might be 1-3 months from
now) Let me know if interested.

It's in central Södermalm. I genuinely despise it, but many people (including
my partner) like it so I'd suggest looking it up first.

41 square meters. 1.5 rooms. Fully renovated bathroom (Nov 2013)

Favourite perks

2 Seconds to Lidl 7-22

10 seconds to Systembolaget (liquor store) 9-19 (weekdays)

15 seconds to ICA (has a tapas bar with nice wines) 7-23

20 seconds to Apoteket (Pharmacy) 8-22

20 seconds to Medborgarplatsen subway

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undantag
Jag har två kompisar som söker lägenhet från Januari. Kommer du åt det här
eventet?

[https://www.facebook.com/events/352962604886482/](https://www.facebook.com/events/352962604886482/)

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bitwize
Stockholm's home stock stunted; startups stifled

You're gonna have to learn to talk that _Variety_ speak!

~~~
likeclockwork
Thank you.

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raverbashing
Yeah, unfortunately most European cities are built to the max density allowed
with old buildings that cost a lot to maintain and that offer an inferior
experience to modern ones.

Rent controls and policies made for a negative populational growth only make
things worse

~~~
lingoberry
Not really, part of the reason people want to live centrally in the first
place is the density and the high quality turn-of-the-century housing. Tall
ceilings, nice wooden floors, large windows. It sounds like you've never
actually been inside one.

~~~
raverbashing
> It sounds like you've never actually been inside one.

No, I've actually seen several ones (not Swedish though)

Most of them are cramped (especially in Ireland/UK)

I've saw the tall ceilings (not really an advantage to me), wooden floors are
nice as well as the large windows, seems like this is more common in
Continental Europe (France/Germany)

But: no elevators until they managed to fit one somehow, the old doors/windows
may be a liability (maintenance also they are not very good heat insulators)

~~~
lingoberry
I'm talking about continental Europe and Scandinavia (including Stockholm
where I live). UK is very different in terms of apartment condition. I've seen
many carpeted floors, and even carpeted bathrooms of all things, really not
acceptable here. Older buildings are very well renovated, and are generally
better built than most new buildings.

As for the rest of Europe, the demand speaks for itself, even if you don't
personally like the style and high ceilings, most people do.

~~~
leg100
Modern housing on the continent is far superior to that in the UK (and I like
carpets!).

There were standards on house building which assured a minimum floor area
which were later abandoned. The UK now has the smallest homes in Europe. The
windows are tiny, and the materials are cheap.

I agree turn-of-the-century housing was generally generously proportioned, and
well built, and stand the test of time. And the housing that followed up to
1940s, even the austere housing that followed in the 50s wasn't bad either.
But from the 60s onwards the quality took a nose dive (there are some good
quality social housing complexes), and the puny mock victorian 80s and 90s
houses are the worst examples.

This is a great book on the subject:
[http://en.wikipedia.org/wiki/A_Guide_to_the_New_Ruins_of_Gre...](http://en.wikipedia.org/wiki/A_Guide_to_the_New_Ruins_of_Great_Britain)

I'd be interested to hear why the UK took a turn for the worse, and other
places didn't (or perhaps they did to a lesser degree). Belgium is similarly
cramped but seems to continue to build good proportioned housing.

