Swedish PM reshuffles cabinet, Green's Lovin new deputy

STOCKHOLM (Reuters) - Swedish Prime Minister Stefan Lofven named Green Party's co-leader Isabella Lovin as his deputy in a mid-term cabinet reshuffle aimed at giving the minority coalition fresh energy after a series of scandals and falling poll numbers. Two years into a four-year term, voters have little faith in the coalition as a result of its hesitant response to the asylum crisis and a series of gaffes by Green Party politicians, with polls showing Lofven himself deeply unpopular. "This means that we will be able to deal with the central questions such as schools, jobs, the environment, house building ... and the EU's future with renewed power," Lofven, a Social Democrat, said. "We will develop the Swedish model, not dismantle it." The reshuffle comes after former Deputy Prime Minister Asa Romson was replaced as the Greens co-leader and the former housing minister, also from the Green Party, was forced to quit in April. Lovin will need to show disgruntled party supporters that the party can set the agenda after a number of high profile policy defeats including over tighter asylum rules. A test will be whether the Greens can stop the sale of state-owned utility Vattenfall's lignite mines in Germany, which the company has agreed to sell to Czech firm EPH. The Greens kept the environment ministry and Lofven also appointed former party leader Peter Eriksson as housing minister. Sweden has build too few houses for decades and with a growing population, swelled by around 160,000 asylum seekers who arrived last year, there is an acute shortage of homes. Ultra-low interest rate and tax breaks for ownership have helped fuel a surge in house prices leading many to warn of a housing bubble. Recent polls show the Green Party just clearing the four percent hurdle for seats in parliament with the Social Democrats - at around 25 percent - well below the 31 percent they got in the general election in 2014. The coalition, supported by the Left Party, got the support of 38.6 percent of voters in the latest poll-of-polls by Novus for Swedish radio. The four party centre-right Alliance opposition bloc got 41.6 percent. (Reporting by Simon Johnson and Johan Sennero; Editing by Alistair Scrutton)