In January, the Norwegian housing market experienced a remarkable price increase of 3.4%, with a seasonally adjusted rise of 0.7%. This marks a year-over-year growth of 1.4%, according to Henning Lauridsen, CEO of Eiendom Norge. This development signals a strong comeback for the housing market, even in light of economic challenges and an unexpected interest rate hike in December.
Seasonally adjusted data indicates that housing prices rose by 0.7% from December to January, pointing to a positive trend in the market. Lauridsen notes that this upturn is particularly striking given the weak development in the Norwegian mainland economy.
In January, 6,757 homes were sold, a decrease of 2.2% from the same month last year. The number of new homes listed for sale also fell, with 5,876 homes hitting the market, 5.8% fewer than in January 2023. This has contributed to a reduction in the accumulated inventory of unsold homes, which has steadily decreased since its peak in October.
While Porsgrunn/Skien experienced the strongest seasonally adjusted price growth at 2.2%, Fredrikstad/Sarpsborg had the weakest with a decrease of 0.7%. Most areas saw an increase in seasonally adjusted prices, with some regions notably experiencing particularly strong growth.
Lauridsen expresses concern for the Norwegian economy and the decline in housing investments, suggesting that the Central Bank of Norway needs to adjust its interest rate policy to reflect the strength of the housing market. He hints at a possible adjustment of the interest rate path and the policy rate in March.
Eiendom Norge has introduced a new model for housing price statistics, which shows a larger fall in housing prices in the last half-year than previously estimated. This change in the calculation method provides new insights into the dynamics of the housing market and may influence future analyses and forecasts.
Source: dn.no
