Advertisement

Property For Members

Will Autumn be the best time to buy property in Norway?

Will Autumn be the best time to buy property in Norway?
House prices in Norway are expected to go down in the Autumn. Pictured are homes in Trondheim. Photo by Maarten Zuidhoorn on Unsplash

House prices in Norway have continued to grow throughout 2022, rising by 8.8 percent in the first half of the year. Could the situation change this Autumn? Here's what experts think.

Advertisement

So far this year, the housing market in Norway has seen strong price growth.

According to Real Estate Norway – the national association for Norwegian realtor brokerages – prices have risen by a whopping 8.8 percent in the first half of 2022. 

The average price for a home in Norway at the end of June amounted to 4,568,840 kroner, but the high price didn't significantly damper activity in the housing market.

So far this year, 53,967 homes have been put up for sale, and 49,702 homes have been sold in the country. In June alone, 11,299 homes were put up for sale, and 10,883 homes were sold.

While fewer homes were sold in June of 2022 compared to the same month last year, compared to the pre-pandemic years and market, the figures are huge for this time of the year.

Advertisement

With the strong growth registered in the Norwegian economy, the high levels of business activity in the oil and gas sector, and the ever-growing costs of housing construction materials, is there any chance that home prices will stabilise towards the Autumn? 

READ ALSO: Norway’s house bidding process explained

Autumn might be a better time to buy

Managing Director at Real Estate Norway Henning Lauridsen told The Local that Real Estate Norway expects the interest rate hikes from Norway's Central Bank (Norges Bank) to stabilise the prices and that the Autumn will likely be a better time to buy a home.

"It will be better than now. We have had prices rise 8.8 percent so far this year. It has been pretty tough for home buyers, but we believe that the interest rate hikes will cool down the market during the Autumn. 

"As you know, in Norway, we usually have a price rise in August. The prices then fall from September until December, generally speaking. 

"That could be the case this year as well, despite the previous two years being exceptions to that rule due to the COVID-19 pandemic. 

"We expect a situation similar to 2019, with prices going a bit down in the Autumn," Lauridsen concluded.

'A difficult situation for first-time home buyers in Norway'

Managing Director at Norway's Real Estate Association (NEF) Carl O. Geving,believes prices will flatten out in late Autumn.

"We will have a decrease in the number of home sales, and the prices will flatten out in late Autumn... maybe they will fall a bit. The price level is high, interest rates are increasing, and the situation remains uncertain," he told The Local.

"This is a difficult situation for first-time home buyers in Norway.

"From 2018 to 2021, the number of first-time buyers increased a lot. However, in the first quarter of 2022, we've seen a strong decrease in these figures, and the trend is likely to continue during the year because of the high price level and interest rates. 

Advertisement

"In Sweden, they had a correction in the last five months. I wouldn't be surprised if we get a correction in Norway as well, but that remains uncertain – it also depends on our Central Bank and interest rates. Regardless, August is usually not the best time to buy a home, the inventory level is low. So, Autumn may be a better time," the expert told The Local.

At the moment, the supply of homes  in Norway is quite low, but Geving believes that the situation will be more balanced by the end of the year. 

'Supply level of homes on the market is low'

"There is a lot of debate in Norway about the current demand and supply level. The supply level is very low now, while the demand is pretty ordinary. That is one of the reasons the price has gone up so much in the first part of the year – the low supply level," Geving said.

"However, we have to remember that we have had two years of the COVID-19 pandemic, with historically strong demand. That's the main reason why the inventory level has been lower in 2022. 

"As the pandemic ends, the demand will somewhat decrease and return to its normal cycle. Furthermore, I think the rising interest rates will also decrease demand. The market will be more balanced by the end of 2022, and – when one looks at the price level – sellers will probably have to lower their asking price," Geving concluded.

More

Comments

Join the conversation in our comments section below. Share your own views and experience and if you have a question or suggestion for our journalists then email us at [email protected].
Please keep comments civil, constructive and on topic – and make sure to read our terms of use before getting involved.

Please log in to leave a comment.

See Also