Reflections from Almedalen 2025 by Edwin Måradson, CSO at NordNest AB

This year in Almedalen, housing was not just a political issue – it was the issue.

In panels, data presentations and round-table discussions, the same core issue recurred in various forms:

How can we make it easier to access housing?

But underneath that question is a deeper one we’re not always willing to ask:

What kind of affordability are we trying to achieve – and what drives the gap between need and delivery?

From the outside, it may look as though construction isn’t happening because there’s no demand. In reality, it’s the opposite: the demand exists, but developers cannot make the numbers add up.

The reality: costs are too high to build, even where the need is greatest.

In one of the week’s most telling sessions, analyst Ted Lindqvist pointed out that Sweden needs over 52,000 new homes per year to meet future needs. Right now, we’re delivering roughly half that.

Why?

This is because construction costs have increased significantly. Materials, labour, planning processes and risk – all have become more expensive.

The result is clear: the math no longer works.

Rethinking Affordability: It’s Not Just About Ownership

Several panels focused on helping more people to buy – by easing credit requirements, offering starter loans or reducing amortisation requirements.

But affordability is not only about owner-occupied housing. It is equally about rental housing – particularly in cities where labour markets, mobility and social access require flexible forms of tenure.

The Real Cost Problem: Not That Homes Are More Expensive – But That Buyers Can’t Afford Them

It is easy to say that prices have risen. But in fact, market prices have not changed dramatically.

The real issue is that households’ purchasing power has declined, while construction costs have risen.

So we’re now in a double bind:

• Developers can’t build because construction costs are too high.
• Buyers can’t buy or rent because prices feel unaffordable given their financial limits.

Raising prices and rents or increasing purchasing power are solutions that take longer to achieve than working to reduce construction costs using proven, existing methods and system solutions.

We heard in one analysis that a 13% increase in housing prices could result in 20% more housing starts – because developer margins would become viable again. That’s how tight the current margins are.

Yet here lies a paradox: building more cheaply does not automatically mean it will be sold more cheaply – unless there is a mechanism (policy, procurement, or pressure) to ensure that cost savings are passed on to the end customer.”

It is a broader issue. But on the production side, we must at least begin by eliminating inefficient, non-value-adding activities and preventing defects and shortcomings that emerge during the warranty period..

Systems Thinking: Start Where the Bottleneck Begins

We cannot solve affordability solely from the demand side. If the bottleneck in project planning remains, we are merely treating the symptoms.

This is where systems thinking becomes tangible – not as a policy slogan, but as a practical tool.

• What if installations were configured before the design process even began?
• What if energy performance, smart metering and climate requirements were built in from the start – not at the end?
• What if project costs could be accurately forecast before design lock-in, giving developers and municipalities the confidence to proceed?

This is not hypothetical. There are already solutions that make this possible. They make property development configurable, faster, more sustainable – and, above all: possible.

With lower construction costs, more projects can become viable. This increases supply – and, over time, creates the conditions for price pressure. Not immediately, but structurally, in the long term.

We must not only make it easier to buy – we must make it possible to build.

As long as development appraisals fail to stack up, every measure on the buyer side will face an uphill battle.

That does not mean we should abandon support for buyers.

But we must pair it with changes on the delivery side.

1. Simplifying delivery systems
2. Reducing onsite complexity
3. Aligning planning, installation, and performance from day one

In short: we need to create homes that do not have to cost what they do today.

That is what makes affordability sustainable – not only for households, but also for developers, municipalities and society as a whole.