House prices rose by 1,2% in March. Looking back at the last 12 months, house prices are now at the same level as a year ago.
This means that the housing price fall in the autumn of 2022 has been “eaten up”.
For home buyers the supply of homes for sale is important, combined with demand from buyers. There are fewer homes listed for sale than last year, and there are slightly fewer unsold objects at the end om March than it was earlier this year. After the Easter Holiday, now in April it seem like the lack of homes put up for sale continues.
Usually there is a spring flow of homes for sale after Easter holiday, but so far it has not occured.
Prices could continue to raise if the lack of homes on the market continues. However mos experts believe that we will see a decline in prices forwards. We have not yet seen the top of the interest rates!
The market is still somewhat clmer than other periods of rising prices, sales take a little bit longer time. That is an advantage for the buyers. But be aware that the market is selective. If you go for the most attractive objects, you will experience tough bidding rounds where you have to stretch your rope or risking not to reach out in the competition.
As in all other countries home buying in Norway is mainly about:
Location- location – location.
Location is a very import requirement for most home hunting people. People have some ideas about which areas are nice to live in or they have some connections to certain areas and the qualities you will find there.
But sometimes the wishes do not match with the money…
The purchase prices differ considerably according to the location and attractiveness, and some areas are regarded better than others. Because of type of houses located there, and available services, communication possibilities, number of schools and access to nature for example. But also, demographic conditions come into play.
Now I am getting closer to the main point of this article.
How safe is it to live in the different parts of the bigger cities in Norway? Which part of the city is the safest neighbourhoods?
Many foreigners, especially people from USA and other bigger countries, are very concerned about this issue. It is of course a very important question, but most Norwegian are not so concerned about the security issue itself. They wish of course for a good living environment, but since most neighbourhoods are perfectly safe the safety issue is not so important.
We have of course some smaller social problems, for example in the outskirts of Oslo, where safety can be an issue, but they are very few.
In most places in Norway, you will be perfectly safe in your home and the neighbourhood.
Despite of this, many Norwegians have somewhat stereotypical perceptions of which areas are nice to live in and they are gladly sharing these opinions to you if you start talking about buying a home.
Please do not take it for granted that all this information is correct. Do your own research, and if possible, visit the different areas to look for yourself.
If you need some advice about where you can afford to buy a property and objective information of different neighbourhoods, please ask me.
I will give you the information to you for free. And I promise to be completely honest!
Norway is a beautiful country, no doubt about that. Many foreigners have a dream about buying a house in a rural area in Norway. On the countryside, by the fjord or ocean and maybe also north of the polar circle.
I have had several inquiries about this and been able to help some of them to fulfil their dream.
However, there are some obstacles, that makes this a little bit more difficult than buying a home or cottage in densely populated areas.
First of all, the market are a little bit limited.
Many rural homes, especially the less expensive one, are not put on the market very often. Relatives, that inherit these properties, tend to keep them for themselves. To use them for holiday purpose or Airbnb for tourists. This is especially common in the North of Norway. Some places it is difficult even for young people who want to stay in their home community or move to a small village to buy a house for their family.
The same problem applies for small farms. It is seldom for sale. The family keeps them, or they are merged with other bigger farms nearby.
Also many Norwegian are dreaming of buying a small farm, but they tend to wish for objects that are near a city or bigger village. This increase the demand and the sales prices are quite high.
Even if the market is a bit limited, there are still homes for sale.
But it is important to be aware of some Laws and Regulation that can be connected to these properties.
Obligation to live rule. Boplikt
Municipalities can implement rules these rules. You cannot leave the house empty. You must either live there yourself the whole or part of the year and rent it out for the rest of the year. This is a policy to prevent the creation of ghost towns.
Duty to get official permission for owning the house – Konsesjon
This is very common for agricultural properties. There may be a duty to run agricultural activities. It is the buyer’s responsibilities to get these permissions after the purchase. It is also a possibility to subcontract the land. But you will never know if this is possible before you are applying for permission to own the property.
The realtor will inform about conditions for the sale in the sales material. It is very important to check out these things very carefully. I will strongly advise you to seek help from an consultant like me before you give a bi on a rural property.
Almost 80% of people in Norway own their own home.
Self-owning has been official policy in Norway since the 1950’ies. During the next decades there was a big development of what we call social housing construction in the whole country. Organizations like OBOS – the biggest housing cooperative organisation in Europe, and other local organisations were established in most cities. They cooperated with the municipalities who made plots and areas available.
The State Housing bank gave mortgages to both builders and private people to finance the home building.
The taxation of property has always been very low in Norway, and you also get tax-deduction when you are paying interest on mortgage. (Today 22% tax deduction)
And there are no taxation on the gain when selling your home.
Until 1983 sales prices were regulated. When the regulations were repealed, there were no way back. From that time, it was all about the market!
The market regulations have functioned quite well for most people. The prices have been rising and people have been able to use their property values to ” climb up the housing ladder”.
Lately we have seen that some people have not been able to buy their own home, because of the requirements for equity and lack of ability to pay the cost of a mortgage. Almost 50% of first-time buyers gets help from their parents to buy their own home. The percentage of self-owners have decreased a little bit lately. And many experts doubt whether we will be able to keep up the big share of self-ownership, what we call the Norwegian Housing model, in the future. Even if it is a goal for all political parties.
Because of the self-own policy, the rental market is not as safe for tenants as we could wish for. As a tenant you are depending on renting from private self-owners on a 3-year contract. And you will not get any of the tax advantages that self-owners have. Therefore it is not regarded very attractive to rent your home in Norway.
As a home buying consultant I strongly recommend all people who ca to afford it, to buy their own home. It is both safe and profitable. It is my impression that people from other countries that settle in Norway, also after some time, are eager to buy their own home. They experience the economic benefits that comes with self owning, and what most of their their Norwegian friends and colleagues do.
It is of course not completely without risk buying a home in Norway. The market goes up and down and it is important to buy a property without errors and omissions. You should have a 3 -5 years perspective on the purchase, and get help to secure that you are paying the correct market price.
And be aware of the buyers duty of inspection. It is essential that you can read and understand all the sales information. Therefore, if you are an English speaker, I strongly recommend that you get help from a home buying consultant (like me:)