Be aware of new regulations for home buying in Norway from 1.1.2022

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From 1.1.22 a new regulation is being introduced in Norway.  The seller, and the realtor, will be obliged to give more detailed information about the technical standard of the home in the sales material.

The seller may be responsible for incorrect and missing information to the buyers.  He or she has this responsibility also today, but so far court decisions have only made the seller liable for damages if the damage or misinformation amounted to at least 5 percent of the value of the home.  This is a lot of money, and therefore the seller has been imposed to give compensation to the buyer only in a few cases.

In the new law the limit for compensation is decreased down to NOK 10.000.

For this reason, the seller must be much more careful to give ALL the information about the property. He must , through the realtor, order a condition report from a technical expert or surveyor.  The government has made a regulation of how this inspection must be implemented and the contents of the condition report.

The purpose is better protection of the buyer.  This is a good thing in my opinion.

Be aware of the new rule about buyers’ duty to inspect !

As a home buyer  you must be aware that the new law has a rule on the buyers’ duty to inspect before giving a bid.  If you miss some information in the sales material or the technical report, or miss other information given on the viewing,  you cannot complain after the bid has been accepted by the seller.

So, the duties goes both ways in the new law!

My concern as a home buying concultant is to protect the buyer.  I am therefore prepared to help my customers to examine the new technical reports carefully and warn them about risk elements.

If you do not master Norwegian, I will warn you to buy a property without help to translate and interpret all the written material.  This is and will still be,very complicated, even for Norwegians.

Because as I have told you before the bid is binding in Norway.

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Successful purchase after corona break

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Erik from The Netherlands contacted me already in December 2020. He is half Norwegian, and he and his family wanted a connection to Norway by purchasing a holiday home.  After mapping their preferences, we found out that Sjusjøen area was the best location for them to enjoy Norwegian nature all year round.

So far, so good, we were ready to cooperate and start the search.  But it turned out to be quite difficult for two reasons:

  • Corona restrictions, they were not allowed to travel to Norway to look at the properties
  • The market for cottages turned crazy. Everyone wanted to buy cottages in the pandemic, and the bidding rounds were extremely “hot”.

Therefore, we decided to take it slowly and wait for better times.

After the summer break, in late august, some cottages were put on the market.  Mainly simple
cabins that were accessible by car only in the summer, but also a few solid all year cabins. The Dutch family had been made aware of the website where all Norwegian properties are advertised finn.no (link to finn.no eiendommer til salgs) and send a link to Boligdama.Where a modern cabin of 96 square meters was announced. I had a nice location and plot in the end of a cabin field.

The buying process went fast 

Due to our experience from last year, we presumed that the cottage easily could be sold after the first viewing a short week later, so we knew that we had to act quickly.Boligdama checked all the sales material and formalities about the property and if the asking price was realistic.  The family got a digital viewing and Erik decided to travel to Norway and look at it the same weekend.  Luckily it was OK to travel with the vaccine certificate. At the viewing he got a very good impression of both the cottage and the Sjusjøen.

The bidding strategy 

When arriving at home we had a digital meeting and discussed the bidding strategy.It turned out that our family were the only bidders even if some other people had viewed the property.   It seems that Norway maybe is back to normal, that means that sale of cottages is a bit slower that ordinary house sales.

The negotiations with the realtor ended below asking price, which by the way was quite in line with current market prices.

Happy ending, happy people:

Congratulation with a successful purchase

What does the family think about the buying process

 

We are grateful that we found Boligdama to help us with our purchase. She helped us nail down the ideal area that fits our needs, but more importantly she walked us through the entire process and gave us the confidence to act quickly when we finally found our dream cabin.

The process in Norway is quite different from what we are used to, so having local help with tons of experience was a must for us.

We can’t wait to get the keys and enjoy the cabin with our friends and family!

Thank you Boligdama for your help!

 

 

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News about the Norwegian Housing market from Boligdama

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To my English speaking followers. 

Here are som update about the Norwegian Housing market and some advice how to deal with the market.

The last months we have seen a little bit less increase in housing prices.  Most experts are predicting a flattening of the prices after the summer.  In Oslo the prices have decreased the last months, it seems that they have reached a peak and are heading for a correction.

As the Corona situation is getting better and better and the economy improves, the interest rates will be increased.  That has a great impact on cooling down the housing prices.  Therefore, we can assume that it will be a more buyer friendly market during and over this summer.

You can find more detailed statistics here.

The buying process in Norway is quite special

As told, the bid is binding and there are no regrets.

And the buyer has a lot of responsiblity on his shoulder, by examining all matters within and around the property before the bidding.

This is quite challenging when you do not know the language and the laws and regulations.

Therefore, I wish that you will seek help before you bid on any property in Norway.

Read more about the bidding round and why you should be careful here.

Wish you a very happy summer

With this nice greeting from a recent customer.

“We found you very helpful indeed and your clear advice was immensly calming and good to have. If you need to have anyone, say how good you were, send them to me.

Thank you for the booklet, which we will keep to our side these next months”  S.Rosenthal.

It seems like the Corona situation is calming down here in Norway and we can look forward to at quite normal summer and autumn.

This is really good news.

Please do not hesitate to contact me during the summer if you have any urgents questions.

Take care

Best wishes

Trude Larsen

Boligdama

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How to bid on real estate in Norway?

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The bidding process in Norway is quite different from a lot of other countries.

First – bid is binding – there are no regrets.  As soon as the seller has received the bid it is binding for you.

Read:   Remember that the bid is binding when you buy a home in Norway

The next thing to remember is that we are using the auction principle.

The highest bid gets the property, and the bidding rounds goes amazingly fast.

The asking price is just something that the seller hopes to get for the property.

Unfortunately, many realtors put a very low asking price in the market, so the bidding rounds have a tendency to be very busy.

In the bidding round, it is a risk that you will follow another bidder far over the market level.  This is not good because you are risking losing money later.  Therefore, you should have a good knowledge about the local housing prices before you give a bid.  The realtor is working mainly for the seller to get as high price as possible and will certainly not warn you if you are rising your bids to much!

Get help to find the correct purchase price.

I can help you to indicate the correct buying price.  I have the same databases as the realtors and will analyse the house or apartment you want to buy and compare them with other similar houses sold in the area.

A couple of hours consultation at the cost of NOK 2.200 is much cheaper than paying for example NOK 400.000 over the market price.  Don’t you think?

If you buy my consulting package all the price estimates for the properties, we are looking at will be included.  Sorry for all the commercial inside an informative blog.  My point is that you should not give a bid on your own if you do not know the Norwegian market and system.

Unfortunately, I have been contacted by a lot of people who want me to help them to clear up problems after the bidding round.  Problems like not putting reservations in the bid, they have paid high over the market level or misunderstood the whole process.

This happens with some Norwegians also.  But if you don’t know the language, it is much easier to overlook important elements.

OK, here you have some words in the bidding form you must be aware of.  

Whether you use paper form or electronic.

Kjøpesum:
Purchase amount –

Do you have you enough knowledge to tell what the property is worth?

Dette budet er bindende for undertegnede frem til og med:
This bid is binding for undersigned until  – date – and time.

Seller are allowed to accept bid earliest at 12.00 noon the day after the last viewing (open house)
There are some exceptions with bids directly to seller, but the main rule is as described over.

After the first-time limit, 12.00 noon the time limit is usually 30 min.

Eventuelle forbehold
Possible reservations

This is very important to write down if you have any.

It could for example be:

We want the washing machine included.

We will have a confirmation that the leakage in the roof will be fixed by the insurance company.

The parking space is included.

If you forget to put reservations in writing it will be difficult to prove later that you made them.

Reservations about financing

If you put a reservation about financing the purchase your bid will probably not be accepted.  So this is rarely used.

Ønsket overtakelse:
Take over date – (your wish)

This is a part of the bidding negotiations.  You should ask the realtor what the seller prefer.  If you can put the same date as seller’s preference it would be an advantage for you.

But if you are stretching the price upwards you should demand a take over date that suits you best.

Financing

You must fix the financing in advance and your bank contact or other official person  must confirm that you are able to pay the bidding amount.

You put this in the bidding form:

Kjøpet vil bli finansiert slik:
The purchase will be financed this way:

Fill in contact information to the bank contact.

You must fill out your personal information and sign the bidding form (or electronic with bank id)

If you use the paper form, you also must send picture of your passport to the realtor.

The realtor will help you with filling out details.

But please do not tell him about your credit limit or budget. Or send any document about this.

He/she will use it to get a higher bid.  The only thing the realtor should know is confirmation that you can finance your bid!

This was a brief overvview of how to give a bid on property in Norway.

It is so many details that can emerge in the process, so it it not possible to tell you everything.

Please contact me if you have any doubts before giving a bid.

To be honest, I prefer that you contact me before the bidding round.  Probably it will be to late you if you already have given the bid.😊

Read: Househunting in a new country is quite challenging

 

 

 

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