Swedbank and Handelsbanken still dominate the mortgage market despite declining market shares, controlling around 50% of the market. However, a recent analysis by Afv revealed that borrowing money from Nordea is the most expensive among the major banks.
For smaller players, the superior distribution and financing channels of the major banks have made it challenging for other actors to break into the market. But now, some of the smaller players are joining forces and aiming to challenge the major banks with their new joint venture, Borgo Hypotek.
Just like the major banks, Borgo can attract deposits and therefore has multiple sources of financing. The total mortgage volume by mid-year was 33.7 billion SEK, equivalent to a market share of just under 1%. Despite growing by 100% last year, Borgo ended up with a net interest income of -77 million SEK.
A Collaboration of Key Players
Behind Borgo, a relatively new player, are ICA Banken, Kamprandbanken, Ikano Bank, Ålandsbanken, Söderberg & Partners, and Sparbanken Syd.
“We have an aggressive growth plan that we aim to achieve by challenging the major banks’ high margins on mortgages,” says Erik Salzberg, business manager at ICA Banken.
However, Borgo operates more in the background, with the respective brands serving as the front-facing entities that convey mortgages to their customers.
“The intermediaries set the prices for the customers, but Borgo makes the credit decisions and acts as the lender,” explains Adam Lewenhaupt, Borgo’s marketing manager.
ICA Trades Grocery Bags for Lower Rates
For ICA Bank’s customers, the more they spend at ICA, the better interest rates they receive.
A customer who spends over 6000 SEK a month at ICA can have their interest rate reduced by up to 50 basis points. For a loan of 15 million SEK with 50% leverage, this translates to approximately 2800 SEK lower cost per month before tax deductions. “We have taken a comprehensive approach to everyday economics where the biggest cost items for ordinary customers such as housing, food, insurance, pharmacy, and health provide better mortgage rates. The overall value offering ensures that customers have more money left in their wallets,” says Erik Salzberg at ICA Banken.
With high inflation and rising interest rates looming, the mortgage market has been even slower than usual. However, there has been some sort of trend reversal this year, leading to increased activity and greater demand for mortgages. The question is, what will the mobility look like?
Ensuring Fair Conditions for All
“We believe that everyone should have the opportunity for fair conditions with clear and transparent pricing, which is why our mortgage rates are based on the loan-to-value ratio. On our website, you can see directly what rate you will receive; it is pre-negotiated and clear,” says Katarina Erichs Emilson, communications manager at Ikano Banken.
Ikano Bank operates similarly to ICA Banken, where members, in this case, Ikea members, receive better mortgage rates.
Just like at ICA Banken, Ikano Bank customers can borrow up to 85% of the property’s value. However, one should be cautious of fees that make the effective interest rate slightly higher than it appears at first glance.
A comparison between these two players shows that Ikano Bank’s customers have received slightly lower rates in both 2022 and 2023, but ICA Banken’s customers have been able to borrow more affordably this year.
Landshypotek Offers Affordable Mortgages
Even cheaper is borrowing through Landshypotek, which is owned by 34,000 farmers and foresters. The bank truly stands out compared to the major banks and other smaller yet relatively larger challengers like Skandiabanken and LF Bank.
“We have begun to establish ourselves as a significant challenger, where open and non-negotiated rates have been a central part of what many appreciate. We and a few other challenger banks are charting a new path. Recently, we have lent nearly 27 billion SEK in mortgages to customers nationwide,” says Catharina Åbjörnsson Lindgren, head of mortgages at Landshypotek.
In August this year, Landshypotek’s average variable loan rate was 4.15%. This is cheaper than any other actor Afv has looked at.
“The major banks used their deposit money and had a competitive advantage for a while, but now, as interest rates have fallen, we have returned to the previous order, and we have also led the Riksbank rate cuts on several occasions. Since the turn of the year, we have also lowered the list price on the 3-month rate more than both the Riksbank and most of our competitors,” says Catharina Åbjörnsson.
Limited Loan-to-Value Ratio
However, there is a catch. If you need to borrow up to the 85% mortgage cap, it is not possible.
“We chose to limit the loan-to-value ratio to 75% when we started with mortgages and were new to the mortgage market. We continuously evaluate how we can develop our business to best meet the needs of our customers. The loan-to-value ratio we choose is part of that evaluation. Right now, we have a high demand for our mortgages and see that more and more customers are finding their way to us,” says Catharina Åbjörnsson.
Mortgage Funds Trying to Attract Customers
Other players vying for a piece of the mortgage pie are Stabelo with high-profile owners like H&M’s Stefan Persson, Creades, and Brummer’s Kent Janér, as well as Schibsted-owned Hypoteket. These two actors have a financing model that differs from most others, making it more challenging for them. The money invested by pension companies like Folksam, SPP, and Alecta is placed in a so-called mortgage fund from which money is lent to mortgage borrowers. However, without secured bonds and without financing in the form of deposits, the model has its weaknesses.
The difference between Hypoteket and Stabelo is that Hypoteket lends up to 75%, while Stabelo can only lend a maximum of 60% of the property’s value. With a higher loan-to-value ratio, the risk in the mortgage portfolio increases, and therefore, the return requirement, which means that Hypoteket’s rates are slightly higher than Stabelo’s, as shown by Afv’s analysis. However, it is primarily the major banks that Hypoteket aims to challenge.
“The rapid interest rate hikes during 2023-2024 have favored actors with significant deposits who have seen the margin on their mortgage business more than halved but compensated through delayed or absent interest rate hikes on their customers’ savings and transaction accounts. However, we do not believe that the banks will accept lower revenues on their mortgage business over time,” says Hypoteket’s CEO Carl Johan Nordquist.
Online Brokers Also Join the Price War
Online brokers Avanza and Nordnet are also part of the price war. However, the size of the interest rate depends on how much savings you have.
Nordnet offers the lowest rate to borrowers with 15 million SEK in total savings, where any occupational pension is included.
If you manage to accumulate this amount, the interest rates are truly favorable, but not always the cheapest.
Nordnet och Avanza är två av de största aktörerna på den svenska finansmarknaden när det kommer till att erbjuda sina kunder olika finansiella tjänster, inklusive bolån. För kunder som har en kapitalunderlag på mindre än 5 miljoner hänvisar Nordnet dem till Stabelo, medan Avanza förutom Stabelo även marknadsför Landshypotek till sina kunder.
Enligt Sofia Svavar, kommunikationschef på Avanza, riktar deras eget bolån sig enbart till kunder inom Private Banking och räntan är direkt kopplad till styrräntan. Dessutom erbjuds kunder rabatt beroende på hur stort sparande de har hos Avanza. Svavar betonar att Avanza endast lånar ut en liten del av sin inlåning och har en begränsad pott att låna ut till bostäder.
Det finns en tydlig strategi bakom varför Nordnet och Avanza väljer att samarbeta med specifika bolåneleverantörer för att tillgodose behoven hos sina kunder. Genom att hänvisa kunder med mindre kapital till Stabelo och samtidigt erbjuda Landshypotek till övriga kunder, kan Nordnet och Avanza säkerställa att deras kunder får skräddarsydda bolånelösningar som passar deras individuella ekonomiska situation.
Stabelo och Landshypotek har sina egna unika fördelar och erbjudanden som lockar Nordnet och Avanzas kunder. Genom att samarbeta med dessa bolåneleverantörer kan Nordnet och Avanza erbjuda ett brett utbud av bolåneprodukter som täcker olika behov och preferenser hos deras kunder.
Det är viktigt för Nordnet och Avanza att kunna erbjuda konkurrenskraftiga bolåneräntor och villkor för att behålla och locka nya kunder. Genom att samarbeta med Stabelo och Landshypotek kan Nordnet och Avanza dra nytta av deras specialiserade expertis inom bolånemarknaden för att säkerställa att deras kunder får de bästa möjliga bolånevillkoren.
Att erbjuda kunderna tillgång till olika bolånealternativ är en del av Nordnets och Avanzas övergripande strategi att erbjuda en komplett och heltäckande finansiell tjänsteplattform. Genom att samarbeta med Stabelo och Landshypotek kan Nordnet och Avanza stärka sitt erbjudande och positionera sig som ledande aktörer inom bolånemarknaden.
Nordnet och Avanza har en gemensam vision att göra det enklare och mer lönsamt för sina kunder att hantera sin ekonomi och investeringar. Genom att erbjuda bolåneprodukter från Stabelo och Landshypotek kan Nordnet och Avanza bidra till att göra det möjligt för sina kunder att förverkliga sina drömmar om att äga sitt eget hem och investera i framtiden.
I en tid då bostadsmarknaden är i ständig förändring och bolåneräntorna påverkas av olika faktorer, är det avgörande för Nordnet och Avanza att kunna erbjuda sina kunder stabila och konkurrenskraftiga bolånevillkor. Genom att samarbeta med pålitliga och erfarna bolåneleverantörer som Stabelo och Landshypotek kan Nordnet och Avanza säkerställa att deras kunder får de bästa möjliga bolånelösningarna.
Sammanfattningsvis är samarbetet mellan Nordnet, Avanza, Stabelo och Landshypotek en viktig del av deras strategi att erbjuda sina kunder de bästa möjliga finansiella tjänsterna och produkterna. Genom att samarbeta med specialiserade bolåneleverantörer kan Nordnet och Avanza säkerställa att deras kunder får skräddarsydda bolånelösningar som passar deras individuella behov och önskemål.