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RENTING

Rental prices in Norway’s biggest cities continue to rise

The cost of renting in Norway's four largest cities rose overall during the third quarter, with prices up six percent this year, figures from Real Estate Norway show. 

Pictured are streets in Stavanger Norway.
The cost of renting in Norway's largest cities increased during the third quarter. Pictured are streets in Stavanger Norway. Photo by Caitlin Wynne on Unsplash

A sharp increase in rent prices in Norway continued throughout the third quarter, figures from Real Estate Norway (Eiendom Norge) released on Tuesday show. 

“Real Estate Norway’s rental housing price statistics show a historically strong rise in rental housing prices in Norway in the third quarter,” Henning Lauridsen, CEO of Real Estate Norway, stated in a report on the latest figures. 

Growth was most robust in Stavanger and Oslo, according to Real Estate Norway. 

“The strong growth in rental prices we have seen in the wake of the pandemic continued in the third quarter, and it is particularly in the Stavanger region and in Oslo that the growth in rental prices is strong,” Lauridsen said. 

Stavanger and nearby Sandnes saw the largest price increases, with the cost of renting there increasing by 4.7 percent during the third quarter. During the same period, rents in Oslo increased by 2.5 percent, while a marginal 0.3 percent rise was recorded in Trondheim. 

While the cost of renting in Norway’s four largest cities overall increased by 2 percent, rental prices in Bergen declined. There, rents fell by 2.5 percent in the third quarter.

Lauridsen said that the increase in rental prices was likely to continue due to several factors. High inflation, interest rates, increased taxes on rental properties and a low supply of homes on the market all contributed to increasing rents. 

However, he did note that the supply of rental homes on the market had increased in Trondheim and Oslo since the summer. 

Lauridsen said that the least well-off financially were being hit hardest by rent rises. Previously, the Norwegian government has informed The Local that it will not introduce a temporary cap on rent increases. 

READ MORE: Norway’s government rules out a temporary rent cap

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ECONOMY

Moderate party’s mortgage pledge ‘would harm Sweden’: Riksbank chief

The head of Sweden's central bank, the Riksbank, has warned that suspending rules forcing banks to demand mortgage repayments from borrowers -- something pledged by the parties forming Sweden's next government -- would be "damaging for Sweden".

Moderate party's mortgage pledge 'would harm Sweden': Riksbank chief

All four of the parties backing Moderate leader Ulf Kristersson as Sweden’s next prime minister said in the run up to September’s election that they would either suspend or reduce the so-called “amortisation requirement” once in government. 

But in an interview with the Aftonbladet newspaper, Stefan Ingves, who steps down as the bank’s governor at the end of this year, said that the measure would be poor economic policy in the current inflationary situation. 

“This is an inappropriate measure which would harm Sweden if you did it,” he said. “You’ve got to understand that we have enormous amounts of mortgage debt in the Swedish economy and that the mortgage market represents a risk for the economy.” 

“It would send an extremely unfortunate signal to say that as soon as it gets a bit more expensive to borrow, then you should stop amortising [paying off the interest],” he said.

Ingves’s statement came as Erik Thedéen, the general director of Sweden’s Financial Supervisory Authority, also criticised the proposal. 

“To use the amortisation tool in the same direction as during the pandemic would quite simply be a wrong measure,” he told Sweden’s state broadcaster SR in its regular Saturday interview

He said that if the new government wanted to help those who risk personal bankruptcy as a result of rising interest rates, there were much better ways of doing. 

“Only half of households have mortgages, and they typically have fairly strong finances,” he said. “So if we want to help those with the tightest margins, then this is an extremely poor measure, when there are a lot of better measures you could come up with when it comes to finance policy.”

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