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FOOD AND DRINK

High Swedish prices put Norwegians off cross-border shopping trips

Norwegians are spending less money cross-border shopping in neighbouring Sweden, the latest figures from Norway's national data agency show. 

Published: 24 February 2023 12:19 CET
Pictured are Norwegian and Swedish flags.
Norwegians are going on less cross-border shopping trips to Sweden. Pictured are the Norwegian and Swedish flags on Svinesund bridge. Photo by Petter Bernsten / AFP

Locals in east Norway have long enjoyed the tradition of heading to Sweden for cheaper goods and a more varied product selection. Last year, they spent an estimated 10.4 billion kroner on cross-border shopping trips, figures from the national data agency Statistics Norway show. 

However, this is still significantly lower than the previous record set in 2019, Statistics Norway reports. 

“When all the travel restrictions were removed on February 12th last year, cross-border trade picked up again, but Norwegians traded less across the border than was usual before the outbreak of the pandemic. Compared to the record year 2019, the trading amount was 35 percent lower in 2022,” Kristin Aasestad from Statistics Norway said of the figures. 

Additionally, the data shows that Norwegians went on fewer trips across the border for shopping in 2022 compared to the record year of 2019. Overall, the number of trips decreased by just over 40 percent between 2019 and 2022. 

One explanation for the decline in Norwegians heading across to neighbouring Sweden to stock up on groceries is a sharp increase in food prices, meaning that Swedish food prices are no longer significantly lower than in Norway. 

According to Statistics Norway’s figures, food and non-alcoholic beverages in Sweden increased in price by 14.2 percent between 2019 and 2022. Meanwhile, the cost of food in Norway increased by 7.2 percent during the same period. Furthermore, the average spend on a shopping trip abroad has increased from 1,690 kroner in 2019 to 1,835 kroner last year. 

“One explanation for why Norwegians spend more money on each shopping trip may be related to the sharp increase in the price of groceries in Sweden and not necessarily that Norwegians put more in the shopping basket,” Aasestad. 

Just under 97 percent of all shopping trips abroad by Norwegians were to Sweden last year, with Strømstad and Charlottenberg being the two most popular destinations with Norwegians.

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PROPERTY

How does the cost of owning a home in Norway compare to renting?

Many point to owning a home as a wise investment. However, how does the cost of being a homeowner in Norway compare to being a tenant?

Published: 18 September 2023 16:33 CEST
How does the cost of owning a home in Norway compare to renting?

To buy or not to buy – that is the question. While it seems an obvious choice, especially as Norway is a nation of homeowners, it has recently become more challenging.

The reason for this is the 12 interest rate increases since 2021. The current interest rate in Norway is four percent and is expected to peak at 4.25 percent.

Rising house prices in recent years also mean a much larger chunk of money is needed to secure a mortgage.

This effect is doubled when you consider the number of properties in Norway which belong to housing associations, meaning shared debt repayments and joint costs increase.

However, this isn’t to say things have been much rosier for tenants. Interest rates and property tax changes have increased costs for landlords. This also means fewer homes are available, and supply can’t keep up with demand.

All in all, this means that the cost of a two-room apartment in Norway is 6.1 percent more expensive than a year ago. The average cost of renting a two-room flat was 14,402 kroner per month in August, according to figures from the rental agency Utleiemegleren. The price of a detached house was 21,533 kroner per month – an increase of 14.5 percent.

In Oslo, it cost on average 16,189 kroner per month for a two-room flat and 30,422 kroner for a detached house. In Trondheim, a flat cost was lower at 11,976 kroner for a two-room apartment. Meanwhile, a place in Bergen with two rooms was around 13,512 kroner per month.

This is just the cost of rent. Tenants will likely need to pay for utilities such as energy. Depending on where they move, water and Wi-Fi may already be included. Energy bills can range from around 700-400 kroner for a small apartment each month.

When renting in a housing association, the joint costs and shared debts must be included in the rent price. This means it cannot be charged separately.
In August, the average home price in Norway was 4.54 million kroner.

If you were to buy a home for the average house price, you could afford to buy pretty much anywhere in Norway. Although, your options will be more limited in the biggest cities.

The most common deposit required in Norway is 15 percent. Currently, interest rates on mortgages are between 5 to 6 percent.

READ MORE: Are Norway’s mortgage requirements different for foreign residents?

Were you to buy a house in Norway for 4.54 million kroner with a mortgage of 85 percent over 25 years – the mortgage would cost between 22,000 and 24,900 kroner per month, depending on the rate you get.

This would cost a few thousand kroner more per month than renting a three-bedroom flat in Oslo at an average cost of 19,821 kroner each month.

Were you to extend the repayment period to 30 years, you would be paying around 21,019 kroner per month.

One thing to remember is a large number of properties do belong to a housing association. This means that you will need to factor in the average monthly costs and the mortgage. What you pay in monthly fees will depend a lot on the association.

Amenities, the size of the property you are purchasing and the overall debt of the housing association you are buying into all affect the monthly costs. When purchasing a home in the region of 4.54 million kroner, you can expect to pay between 2,000 and 4,000 kroner in monthly expenses.

Those buying a house for less will typically have much lower costs. Even for 3.5 million kroner (one million less than the national average), you will be able to find homes in Oslo and Bergen. For a mortgage of just over 3 million kroner, the average monthly mortgage costs will be between 17,815 and 19,455 kroner.

For house hunters looking to buy for a different figure, the Norwegian Consumer Council’s Finansportalen has a mortgage calculator. 

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