Strong rise in housing prices in May
Housing prices rose by 1 per cent in May. Adjusted for seasonal variations, prices rose by 0.6 per cent.
House prices are now 11.3 per cent higher than a year ago.
- House prices rose in May more than normal for the month. The exception is Oslo, where prices fell by 0.6 per cent. In the smaller towns in Eastern Norway, prices rose sharply last month, and this confirms the many reports of high demand for housing in cities such as Drammen, Hamar, Fredrikstad, Sarpsborg, Tønsberg, Porsgrunn and Skien, says CEO of Eiendom Norge, Henning Lauridsen.
- During May, both sales of second-hand homes and the number of new homes on the market have grown sharply, and never before have so many homes been sold in Norway after the first five months of the year.
- Even though prices rose in May, the 12-month growth in house prices is on the way down. We expect a weaker development in house prices in the future due to the large supply of homes, and that an interest rate increase is imminent. In addition, we now see that the strictest infection control measures against the pandemic will be phased out during 2021 due to the ever-increasing degree of vaccination in the population, says Lauridsen.
Strong revenue growth and larger offers
In May, 10,340 homes were sold in Norway, which is 7.5 per cent more than in the corresponding month in 2020.
So far this year, 43,895 homes have been sold in Norway, which is 15.7 per cent more than in the same period in 2020.
In May, 11,681 homes were put up for sale in Norway, which is 15.5 per cent more than in the same month in 2020.
So far this year, 46,940 homes have been put up in Norway, which is 8.4 per cent more than in the same period in 2020.
- Also in May, significantly more homes were sold than in the same month last year. At the end of May, we are above 2019, which was the previous record year measured in turnover. As it looks now, 2021 will be a record year measured in the number of homes sold. We believe the strong demand for housing in Norway will continue, says Lauridsen.
It took an average of 34 days to sell a home in May 2021, down from 39 days in April. The shortest sales time was Oslo and Drammen w / surroundings with 17 days and the longest sales time was Ålesund w / surroundings with 42 days.
Better financial stability with reduced inflation
Tønsberg w / Færder had the strongest seasonally adjusted price development in May, with an increase of 2.1 per cent. Kristiansand had the weakest seasonally adjusted price development with a decrease of 0.9 per cent.
Tønsberg w / Færder had the strongest development in the last 12 months, with an increase of 14.9 per cent. Tromsø had the weakest development in the last 12 months with an increase of 7.7 percent.
- It is healthy for the Norwegian economy and financial stability that house price growth is now curbed. Eiendom Norge shares the authorities and the IMF's concerns about the large household debt in Norway, and a more moderate development in house prices and applies is healthy for the Norwegian economy, says Lauridsen.
- More moderate price growth provides greater predictability for those switching homes and for first-time buyers, and is positive for all parties in the housing market, Lauridsen concludes.
NB! Tomorrow, the real estate committee will present its NOU on a new law on real estate at 10.00 for Minister of Finance Jan Tore Sanner (H). We encourage the media to attend this press conference.