Buying or renting houses? What is best for expats moving to Sweden?

Once you have made the decision to set up business in Sweden, your corporate relocation services plan will immediately create corporate immigration needs. Employees will need such things as business VISAs, a Swedish tax-ID, enrolment in Swedish Social Insurance, and a local bank account, but one of the most basic needs will be to arrange some adequate housing. Initially, temporary lodgings are often used, but a more permanent policy will soon be needed. One of our clients discouraged foreign staff to buy properties as they wanted to have a workforce that could move with short notice. Companies with international moves will need different policies at different times in their life cycle.

The help of professional international destination services team is of great benefit here since there are many ins and outs to purchasing or renting property in Sweden and because the scarcity of accommodations in many large Swedish cities makes advance planning crucial.

When having international moves to Sweden one of the key decisions for the global mobility team is to what if anything to encourage employees to do in the decision to buy or lease a property. In general, purchase will prove more cost-effective long-term. However, leasing may be necessary if you are unsure how long your business ventures in Sweden will last.

If you wish to encourage your relocating employees to buy a home in Sweden, some ways you can “entice” them include:

* Extend their temporary housing allowance to 6 to 8 months to give them time to sell their current home.
* Offer tax assistance and help them with their storage needs in the interim.
* Provide a home-buying program that assists them with the paperwork and the nuances of an extremely fast moving market with the component Swedish auction that can scare the coldest person.

Since foreigners are free to buy homes in Sweden and your employees may be living and working there for a very long time, home-purchasing often makes the most sense. If, however, you prefer to stick with leasing, here are some things to be aware of:

* In Sweden, new residents normally end up renting second-hand. Verify the person renting to you has the authority to do so or eviction could result.
* Most landlords request company leases to secure themselves against defaulted-on rent and property damages.
* Personal leases tend to have 20% to 30% higher rents than market value, and employees will want to be compensated for this.
* Signing the lease in the market’s “off-season” and providing a few months’ deposit help much in securing property.
* Be sure your employee is committed to staying in Sweden for some time.
* Notice rules are very generous for the tenant.

Moving your business and your employees to Sweden is full of opportunity but also of pitfalls. Be sure you are making the best decision for your situation on the rent/buy question, and do not hesitate to seek help from professional destination services.

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