Swedish investment market is up to a slow start in 2023. The first quarter of the year witnessed a sharp decline in activity, with transaction volume falling below 50% of the 10Y average, to just under SEK 14 billion. The second quarter has seen a slight uptake in investor activity, reaching the investment volume of SEK 27.4 billion, while remaining firmly below the 10Y average and down 53% year-on-year. Altogether the volume for the first half of 2023 totaled SEK 41 billion (down 64% year-on-year). In Q2, domestic investors continue to dominate the Swedish investor market, capturing around 85% of the total volume for the period. Residential sector reclaims its top spot as the most popular investment segment (34% of the total volume), followed by healthcare (21%), industrial (20%) and office (13%). Notably, the quoted property companies make up merely 9% of purchasers, whilst constituting over 35% of vendors for the quarter.
As investors face increased financing and transaction cost the yields continued to decompress across the office reaching 3.7%. At the same time the best shopping centres and the logistics sector have seen their prime yields begin to stabilise at 4.2% (Shopping Centres) and 4.75% (Logistics).
