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What to expect from Norway’s property market in 2024

The future of the Norwegian property market is the subject of great interest and speculation. After a rocky start to 2024, things are expected to pick up later in the year.

Published: 20 December 2023 14:14 CET
Trondheim
As 2024 draws near, analysts mostly agree that Norway is likely to experience modest growth in housing prices. Photo by Free Nomad on Unsplash

The Norwegian property market has seen a fall in prices during the autumn of 2023.

The most significant contributing factor has been the sharp rise in interest rates throughout the year, making mortgages more expensive and dampening demand.

READ MORE: Why now might be a good time to buy a home in Norway

Norges Bank – the country’s central bank – recently raised its key interest rate to 4.5 percent, further affecting housing market dynamics.

However, the central bank’s projections for housing prices in 2024 differ from more recent analyses by other institutions and organisations.

What do the latest forecasts say? 

DNB Eiendom, a subsidiary of Norway’s largest bank, DNB, believes that the housing market in 2024 will closely resemble the trends observed in 2023.

According to Nils Robert Elven, the regional manager in Oslo for DNB Eiendom, 2024 is expected to conclude with a modest price increase of two or three percent percent.

“When 2024 is behind us, we believe the total score will show that we have a well-functioning housing market with weak growth. We think 2024 will end with a price increase of up to two-to-three percent,” Elven said.

The primary factors influencing this somewhat conservative forecast are interest rates and inflation.

According to DNB Eiendom, the initial months of 2024 would see house prices fall due to the combination of interest rates and inflation. 

However, as interest rates stabilise and decrease, coupled with anticipated gains in wage settlements during the latter half of the year, DNB expects the housing market to gain momentum.

DNB Eiendom also thinks there may be limited new home construction in Norway moving forward, potentially putting long-term pressure on the second-hand housing market.

Real Estate Norway (Eiendom Norge), the industry organisation that compiles monthly housing price statistics, has a more bullish price outlook for 2024.

They expect house prices to rise by four percent during the year, with particular emphasis on robust growth in Oslo and Stavanger, projecting increases of 6 and seven percent, respectively.

In a statement on Wednesday, Eiendom Norge’s CEO, Henning Lauridsen, attributed this expected growth to wage settlements and anticipated interest rate cuts.

“After two years of weak development, we believe that we will see good growth in housing prices in Norway in 2024. A good wage settlement that gives real wage growth next year will positively affect price development. So will the expected interest rate cuts,” Lauridsen said on Wednesday, the newspaper E24 reported.

Rental market: No good news for tenants

Aside from housing prices, the cost of renting in Norway is also expected to be on an upward trajectory next year.

Several factors are predicted to contribute to this rise in rental prices, including reduced supply, changes in tax rules on second homes, interest rates, energy costs, and inflation (most of these factors have already increased landlords overheads).

READ MORE: Why the cost of renting in Norway will continue rising sharply

Furthermore, the influx of refugees due to the war in Ukraine has increased demand for long-term rental contracts, further exacerbating the supply-demand imbalance.

Therefore, most experts agree that a continued surge in rental prices due to the combination of high demand and limited supply is highly likely.

The rental market is unlikely to improve in the near term, suggesting that high prices will be the new normal for some time to come.

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PROPERTY

Home repairs in Norway: When are you legally required to call out a professional?

In Norway homeowners are frequently drawn to taking repairs into their own hands due to the costs. However, some jobs require expertise to ensure they're completed safely and in line with the rules.

Published: 2 May 2024 16:59 CEST
Updated: 5 May 2024 07:58 CEST
Home repairs in Norway: When are you legally required to call out a professional?

If you have friends or acquaintances in Norway who are homeowners, it probably won’t take long before you start hearing (horror) stories about the astronomical costs of hiring professionals to carry out any sort of repair work.

READ MORE: Why the cost of home renovations in Norway is rising

Replacing a fence on your family home property with a garden? Upwards of 200,000 kroner.

a Small bathroom upgrade? Around 300,000 kroner.

Replacing the wooden façade and isolation for a house? Up to 1,000,000 kroner.

All of the prices quoted above are real-life 2023 examples shared by a family living in a terraced house in the Laksevåg borough in Bergen, western Norway.

So, with the potential to save substantial sums by sidestepping high professional fees, is it any wonder that people in Norway are attracted to DIY repairs?

Key considerations before taking up a renovation by yourself

Yes, the prospect of overhauling your home without breaking the bank holds significant appeal in a country as expensive as Norway.

However, you must be aware of a wide range of regulations, safety considerations, and legal requirements before you start a renovation project.

The first reason why you should engage tradespeople in more ambitious fix-up projects is safety.

READ MORE: How does home buyer and seller insurance in Norway work?

A faulty bathroom or electrical installation can cause costly damages or even pose safety risks, such as leaks or fires.

Always remember that the stakes are also high when it comes to a home’s structural integrity, and that’s why complex projects should be left to professionals.

The second is compliance. Norwegian regulations mandate the construction and adaptation of certain rooms, such as bathrooms, which must adhere to strict standards (for example, they need special waterproof membranes).

You can find more information on the relevant building laws and regulations in Norway on the Building Authority’s (Direktoratet for byggkvalitet) webpage.

Last but not least, know that having work done on your property by yourself or an unlicensed worker can negatively affect the sale price of the home down the line – and even shield you from lawsuits.

There are multiple court cases each year where the buyers of a property sue the old owners over unqualified work that has been done on a property that wasn’t reported as such (in 2023, there was a case in Bergen where a homeowner made changes to a load-bearing wall by himself but claimed that professionals did the work… In the end, an inspection revealed that the job wasn’t done properly and negatively affected the house’s structural integrity; the old owner didn’t have documentation to prove that a licensed operator did the work, and he ended up being sued for millions of kroner).

That’s why most homeowners in Norway insist on having professional documentation of the work performed – the sales benefits are apparent, but it can also be very useful in the event of any unforeseen issues.

When to opt for professional services

From complicated plumbing installations and full-on construction to demanding electrical work, the stakes are high when it comes to home safety.

Therefore, it’s recommended to call upon the expertise of licensed tradespeople, particularly plumbers and electricians, when you need to opt for home maintenance and renovations that involve bathroom construction, electrical work, and construction that might affect the structural integrity of your home.

Bathrooms in particular can be quite tricky, as they need to have waterproof membranes and are often equipped with underfloor heating.

When it comes to electrical work, basic tasks like installing plug-in appliances and switching cover plates are permitted. Still, anything involving wiring, such as installing electric heaters or changing light fixtures, requires the expertise of a licensed electrician.

If you’re residing in cooperatively-owned apartment buildings (borettslag in Norwegian), the cooperative must approve any renovations or maintenance that may impact neighbouring units. This includes work affecting shared walls, floors, or ceilings.

READ MORE: The hidden extra costs when buying property in Norway

So, ultimately, while there may be some tasks homeowners can tackle themselves, such as minor electrical adjustments or cosmetic updates, complex projects involving construction, plumbing, or electrical systems require the expertise of trained professionals.

While expensive, their services will bring you peace of mind, and you won’t need to concern yourself with the “what ifs” associated with DIY solutions that might not stand the test of time – or professional scrutiny.

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