House prices rose by 0.5 per cent in April 2020. Adjusted for seasonal variations, prices fell by 0.2 per cent.
Home prices are now 1.2 per cent higher than a year ago.
- The Korona outbreak has affected housing prices and the volume of transactions in the housing market in April. In Eastern Norway, price trends are weaker than is usual for April. In the country otherwise, the trend is more or less as normal for the month, and both the price trend and the transaction volume are more positive than many expected, says CEO Henning Lauridsen of Real Estate Norway.
- Nationally, the transaction volume is just over ten percent lower than the same month last year, but there are also regional variations. Many of our members also report that the pace of sales in the market has picked up in recent weeks. We therefore expect that activity in the housing market will remain stable in the coming months, but that prices will have a slight negative development in light of the weaker development in the Norwegian economy, says Lauridsen.
Good activity, despite the corona
In April, 7,038 homes were sold in Norway, which is 10.3 per cent less than in the corresponding month in 2019. So far this year 28,289 homes have been sold in Norway, which is 4.6 per cent less than at the same time in 2019.
In April, 8,523 homes were put up for sale in Norway, which is 1.5 percent less than in the same month in 2019. So far this year, 32,056 homes have been put up for sale, which is 2.4 percent less than at the same time last year.
- Fewer homes were sold and leased in April this year than last year. But overall for the first four months of the year, the transaction volume is still high compared to previous years, says Lauridsen.
On average, it took 55 days to sell a home in April 2020. That's up from 51 days in February. Oslo had the fastest sales time with 21 days and the slowest sales time had Ålesund w / surrounding area with 77 days.
Bodø / m Fauske had the strongest seasonally adjusted price trend in March, with an increase of 0.6 per cent. Oslo's weakest seasonally adjusted price trend was down 1 per cent.
The strongest 12-month growth was Fredrikstad / Sarpsborg with 3.6 per cent, while Stavanger w / surrounding had the weakest development in the last 12 months with a decline of 2.4 per cent.
Repeal the Mortgage regulations
- In the wake of the measures against the infection on March 12, we have seen a historic increase in unemployment and layoffs. The Norwegian economy is also affected by the fall in oil prices, and that a number of important sectors are experiencing a markedly weaker demand. This will also affect the housing and credit markets, says Lauridsen.
- Secretary of finance Jan Tore Sanner (H) eased on March 23 the requirements of the mortgage regulations with effect out the second quarter. It is now time to abolish this, as it has fulfilled its purpose of staggering the debt growth in the housing sector. Debt growth has already fallen sharply since the peak in March 2017 and Norges Bank's loan survey from April 23 shows that we will now have the sharpest fall in loan demand since the financial crisis.
- In addition, the requirements related to 60 per cent equity in order to be free of installments and able to withstand an interest rate increase 5 per cent played their part in the Norwegian housing market post corona. It is important for the Minister of Finance to allow banks to practice good and sustainable banking and to allow competition in the credit market to work. The regulations stand in the way of this in the situations we are in now, Lauridsen concludes.