A forecast from Property Norway shows that the price of housing will fall by 1% in 2018, but in Oslo, the price reductions are over.
Property Norway justified the forecast for 2018 by the fact that many new homes have been built in the largest cities over a long period of time, while the need has decreased due to lower population growth.
‘Although the sale of new homes is currently falling, there are still many homes under construction,’ said Christian Vammervold Dreyer, CEO of Eiendom Norge, in a press release.
Property Norway believes the fall in housing prices in Oslo are over, and the change there will be 0%. In Bergen, they expect the biggest fall, of 5%, while Trondheim prices are expected to fall by 2%, and Stavanger prices by 3%.
There is uncertainty as to whether recovery in the Norwegian economy will increase labour immigration again, and thus change levels of population growth. Lower unemployment, and stronger wage growth, indicates a positive development in the housing market, but higher interest rates may also occur.
‘With the level of debt Norwegian households are now gaining, it means that interest rate hikes are likely to have a major impact on household finances, hence purchasing power in the housing market.
This will not, however, have any particular impact on the housing market until 2019,’ said Dreyer.
NTB Scanpix / Norway Today