Rent increase in Sweden highest in 30 years

STOCKHOLM, May 17 (Xinhua) -- Tenants in Sweden face the highest rent increase in three decades, local media reported on Wednesday.

The average increase will be 4.2 percent following negotiations between the Swedish Union of Tenants and the landlords, Swedish TT news agency reported.

"It has been an incredibly tough and long round of negotiations," Erik Elmgren, head of the Swedish Union of Tenants told TT about the increased rent for nearly 1.1 million apartments for the coming year.

Elmgren said that the increases are reasonable even though many tenants are already struggling to make ends meet. "It's not just the rents that are increasing. There is high inflation. Food prices are high. It is a cost of living crisis," he added.

In Sweden, rents are negotiated once a year. When the parties entered the negotiations last autumn, the rate of inflation exceeded 10 percent for the first time since 1991, and the landlords cited increasing costs and soaring interest rates when demanding double-digit increases.

The demands were far too high, as tenants were already struggling with increasing costs of living, Marie Linder, chair of the Swedish Union of Tenants, said in a press release.

After keeping the policy interest rate at zero or sub-zero levels for over seven years, Sweden's central bank (Riksbank) has been continuously raising the rate since last May to the current 3.5 percent to curb rampant inflation.

In April, the country's inflation rate was 10.5 percent year-on-year, according to Statistics Sweden.