Sweden's worst housing slump since 2008 likely to hurt GDP growth

Stockholm

SWEDEN is in the worst housing-market downturn since the global financial crisis.

But with bigger bank buffers and an economy that's growing much faster than the rest of Europe, analysts, regulators and politicians all say everything will be just fine.

First, there's the reason behind the price correction. It's not caused by economic or financial distress, but by a surge in construction (initially to meet excess demand).

Sweden is now a buyers' market, with construction at its highest since the 1990s.

The economy is showing high confidence levels, strong government finances and declining unemployment.

Sweden also boasts some of the world's best-capita…