Strong rise in house prices in January
House prices rose by 3.2 per cent in January. Adjusted for seasonal variations, prices rose by 0.7 per cent.
House prices are now 8.6 per cent higher than a year ago.
- The strong price development we have seen in the housing market continued in January, and as many have announced, there was a strong price increase in January. There was a particularly strong increase in Eastern Norway, Southern Norway and South-Western Norway, says CEO of Eiendom Norge, Henning Lauridsen.
- Oslo stands out as expected in January, and here we also see that there is a widespread element of coups and hot bidding rounds. We consider this to be the reason why the discrepancy between price suggestion and price rises further here.
- I would warn against buying homes and stretching very far in bidding rounds. Historically, we see that it makes the risk of loss great. As interest rates rise, as Norges Bank has announced, house price developments will become more moderate. Even with zero interest rates, there is a ceiling for how much house prices will be able to rise, says Lauridsen.
In January, 6,903 homes were sold in Norway, which is 6.4 per cent less than in the corresponding month in 2020.
In January, 6,570 homes were put up for sale in Norway, which is 8.9 per cent less than in the same month in 2020.
- Significantly fewer homes were sold in January compared with the same period last year. However, we expect that both new homes on the market and the number of sales will increase in the coming months, says Lauridsen.
It took an average of 60 days to sell a home in January 2021. This is the same as in December 2020. Oslo had the shortest sales time with 22 days and Ålesund and the surrounding area had the longest sales time with 87 days.
Oslo strongest - Only housing construction will help
Fredrikstad / Sarpsborg had the strongest seasonally adjusted price development in January, with an increase of 1.5 per cent. Bergen and Ålesund and the surrounding area had the weakest seasonally adjusted price development, with a decrease of 0.3 per cent.
Oslo had the strongest development in the last 12 months, with an increase of 13 per cent. Stavanger and the surrounding area had the weakest development in the last 12 months with an increase of 3.2 per cent.
- Only politics can ensure a more moderate housing price development, says Lauridsen.
- In the long term, it is the Minister for Housing Nikolai Astrup (H) who is working on the solutions through more efficient construction and planning processes. In the short term, only Oslo City Council for Urban Development Arild Hermstad (MDG) and the Planning and Building Agency, can prevent house prices from rising significantly more in Oslo than the rest of the country, says Lauridsen.
- All projects waiting for construction case processing must be addressed. Adequate housing construction is price-reducing, and will compensate for the effect of the lower interest rates, Lauridsen concludes.