How Rent Controls Helped Bring Down a European Government

For the first time in history, a government in Sweden has been toppled by a vote of no confidence from opposition MPs – following a dispute over rent controls.

181 out of 349 Swedish MPs voted in favour of a motion called by the nationalist Sweden Democrats party, leaving centre-left Prime Minister Stefan Löfven with a week to either resign or call fresh elections.

Löfven has led a fragile minority government coalition of his Social Democrats and Greens since inconclusive results in the country’s 2018 general election. But a plan to ease rent controls on new apartments sparked a rebellion by one of the smaller parties that has also been supporting the government, the Left Party.

Rent caps in Sweden have existed since 1947 to stop rents from rising above a certain price. The Centre Party – which has also been propping up the Social Democrat-Green coalition – proposed scrapping rent controls in new builds. Supporters of the idea, mostly on the right, have expressed concerns about a lack of housebuilding due to what they say is a lack of incentive, and a black market of illegal subletting in the country. However the plan was met with strong opposition from the Left Party, which argued the policy could lead to a dissolution of rent controls in the country and unaffordable rents. 

Nicholas Aylott, associate professor of political science at Södertörn University in Stockholm, said that rent controls had truly exposed the fragility of the Swedish government.

“This is an issue that is fairly marginal for most voters who don't actually live in rented accommodation,” Aylott told VICE World News in a phone interview. “But for these two parties, it's a really big deal.”

Aylott said that it was a fundamental opposition to the far-right Sweden Democrats that had brought the Centre and Left parties together, despite potentially unresolvable political differences.

“The fragility of the government is ultimately all about completely different issues – issues of immigration, ethnic integration and law and order,” he said. “The arrival of these clumps of issues on the political exchange over the last few years, and the rise of the far-right party, the Sweden Democrats, is what really kicked over everything that we thought about the Swedish party system.”