Bubble indicator: House prices in Norway are 13% too high

Construction - houses - homesPhoto: Håkon Mosvold Larsen / NTB

A bubble indicator from a research center at Oslo Met estimates that house prices in Norway are 13% higher than they should be.

The bubble indicator, which the housing research center Housing Lab at Oslo Met creates every quarter, calculates what housing prices in Norway should be based on developments in “fundamental factors,” i.e., developments in, among other things, income, interest rates, population, and housing supply.

“If the increase continues, according to the model, it’s a sign of overpricing. And if the discrepancy continues to increase – without us being able to understand it due to structural changes in the economy – one could consider it a danger signal,” deputy head André Kallåk Anundsen in Housing Lab stated.

House prices have risen 9.4% in the past year, but a lower price increase is expected in the coming time.

Source: © NTB Scanpix / #Norway Today / #NorwayTodayFinance

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