Housing prices decreased by 1.3 percent in November 2023. Adjusted for seasonal variations, housing prices increased by 0.1 percent
So far in 2023, housing prices in Norway have risen by 1.3 percent.
The average price for a home in Norway was NOK 4,319,514 at the end of November.
-Housing prices declined by 1.3 percent in November, resulting in a small increase of 0.1 percent when seasonally adjusted. Similar to the past few months, the seasonally adjusted figures continue to be influenced by the particularly weak development in the fall of 2022. Looking at November in previous years, the trend remains weak despite the slight increase, says Henning Lauridsen, CEO of Eiendom Norge.
-There have been slightly fewer home sales than in November last year, but overall in 2023, we are almost at the same level as last year. The used housing market is functioning well, despite the weak price development since August and lower real estate prices, says Lauridsen.
-We also expect a weak development in housing prices in December, but the big question is how January 2024 will turn out. January is known as the month with the highest price growth during the year. If the Central Bank of Norway cancels the interest rate hike in December, and Finance Minister Trygve Magnus Slagsvold Vedum takes action on lending regulations, next year could be better for the housing market and the new housing market than it currently appears, he says.
Continued Good Activity
In November, 6,683 homes were sold in Norway, which is 8.7 percent fewer than in the same month in 2022.
So far this year, 87,714 homes have been sold in Norway, which is 0.8 percent fewer than in the same period in 2022.
In November, 6,164 homes were listed for sale in Norway, which is 16.8 percent fewer than in the same month in 2022.
So far this year, 100,424 homes have been listed for sale in Norway, which is 0.9 percent more than in the same period in 2022.
-The activity in the used housing market is stable, despite the shift in price development over the past three months. The number of unsold homes has also decreased significantly throughout the month, says Lauridsen.
It took an average of 49 days to sell a home in November, up from 41 days in October. Stavanger with its surrounding areas had the shortest selling time with 30 days. Hamar/m Stange had the longest selling time with 96 days.
Housing Construction Affects the Norwegian Economy
The strongest seasonally adjusted price development in November was observed in Stavanger with its surrounding areas, where prices increased by 2.2 percent.
The weakest seasonally adjusted price development was on Romerike with a seasonally adjusted decrease of 1.7 percent.
The strongest development so far in 2023 has been in Stavanger with its surrounding areas and Kristiansand, with an increase of 8 and 7.9 percent, respectively. The weakest development so far this year has been in Bodø with Fauske, with a decrease of 2.3 percent.
-Housing price development in Stavanger and Kristiansand continues to significantly differ from the rest of the country, and we expect these cities to stand out when 2023 concludes. In the rest of Norway, the picture is different, and most areas will end up around plus-minus zero by the end of the year, says Lauridsen.
-The state budget was clarified over the weekend with the government's budget agreement with the Socialist Left Party (SV). There are many good countercyclical measures for the new housing market, the construction industry, and the rental market, including the significant investment in the construction of student housing. SV deserves credit for this, but the agreement to reintroduce the start loan scheme for first-time buyers is a step backward into the future.
-This proposal is, in fact, a direct consequence of the lending regulations. First, the state forbids banks from providing loans to many first-time buyers through the lending regulations, then the Housing Bank will provide the same first-time buyers with loans. We largely achieve the same by lifting credit rationing in lending regulations instead. It is also logical when interest rates are normalized after a decade of low-interest rates, simultaneously experiencing a significant decrease in real debt, he says.
-Moreover, the lending regulations seem to act as economic management, pulling down the new housing market, housing construction, and the Norwegian economy. If we don't quickly reverse the trend in the new housing market, we will grapple with the consequences for a long time to come through increased inequality, weakened ownership, higher rental prices, and increased public spending on housing-related measures.
-It is urgent to do something about the lending regulations, he concludes.
Complete statistics can be downloaded from www.eiendomnorge.no.
Watch Boligbobla TV with the press conference from 10:30 to 11:30 here.
The press conference starts at 11:00. Before and after the press conference, Erik Lundesgaard, Head of Communication and Policy, has relevant guests from the housing market in the studio who comment on market developments.
Today's guests are CEO Marianne Sodeland of &Partners and partner Baard Schumann (UNION Residential).
Eiendom Norge's forecast for the housing market in 2024 will be presented at a separate press conference on December 20, 2023.