Read news from:
Austria
SHARE
COPY LINK
For members

PROPERTY

How does home buyer and seller insurance in Norway work?

When purchasing or listing a home in Norway, you can take out insurance on the transaction. So, what do policies offer, are they required, and should you consider one?

Published: 9 April 2024 12:40 CEST
Pictured is a home in Norway.
What's the difference between buyer's and seller's insurance in Norway, and do you need either?

Insurance policies in Norway cover both the sale (boligselgerforsikring) and purchase (boligkjøperforsikring) of a property. 

Both policies cover any potential expenses that could occur with a property. This could be if the property had a fault not previously picked up on or to cover legal costs if the buyer wants to make a claim against the seller. 

READ ALSO: What foreign residents in Norway need to know to get a mortgage

Property purchases in Norway have a liability period of five years, and insurance covers the entire liability period. 

Seller’s insurance covers the party who sold the property if there was an issue with the home and will cover the buyer’s costs. 

The rules for selling property in Norway have changed in recent years. Previously, homes could be sold “as is,” which meant the buyer was more responsible for costly issues with the home. 

However, this rule has now been phased out, and most properties in Norway come with an extensive property report where any known and potential issues with the home’s condition must be listed. 

The seller of the home is far more responsible for errors and defects with the house that the buyer was not aware of when making the purchase compared to when homes could be sold “as is”. 

READ MORE: The important small print to look out for when you buy a house in Norway

Still, sellers can, in some cases, be responsible for damage and issues that they were not even aware of. For example, prior work carried out in kitchens and bathrooms that weren’t approved by the authorities would count, as would water damage. 

When this happens, the selling party usually has to repay part of the purchase price or discount the home. 

Seller’s insurance can also be used when issues cost more than 10,000 kroner to correct, with the policyholder paying the first 10,000 kroner. 

The insurance also includes lawyer coverage in the event that the claim goes to court. 

Seller insurance is normally priced at between 0.2 and 0.55 per cent of the sale price. 

Home sellers’ insurance isn’t a legal requirement, and you can sell a home without it, although many brokers recommend it. 

Most homes sold in Norway are sold with seller’s insurance, which is especially recommended when selling older, larger properties. 

The condition report that is now common also means that the risk of the buyer discovering any undisclosed issues with the home is quite low, but not zero. 

Whether the seller has taken out insurance shouldn’t matter too much to buyers. Just because a seller has such insurance doesn’t mean the home is fault-free or that you will have greater rights than if the seller didn’t have insurance. 

Buyer’s insurance, meanwhile, covers legal costs incurred by buyers if they wish to file a complaint. 

For example, should their be issues with the pipes in the property that neither party knew about, seller’s insurance covers the cost of the repairs, while buyers insurance covers the legal costs of making the complaint. 

Therefore, the main perks are having access to a lawyer if you need one and avoiding legal bills. 

However, you most likely won’t end up using your buyer’s insurance policy, as the seller’s insurance resolves many disputes before going to court. The insurance company also decides whether it’s worth taking your case to court.

While insurance for sales is standard practice, buyer’s insurance is less common. 

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.
For members

PROPERTY

The key things you need to know about purchasing property in rural Norway 

Whether it's time to up sticks and get away from Norway's cities, or you've always dreamed of owning a holiday home in the country's stunning rural areas, there is some key info you need to know. 

Published: 26 April 2024 15:21 CEST
The key things you need to know about purchasing property in rural Norway 

This article was based on several questions from a reader. The Local Norway aims to answer readers’ questions, even if it isn’t used for an article. So if there’s something you’ve wondered whether it’s practical or cultural, you can drop us a line at [email protected] 

It’s no surprise that Norway’s countryside attracts so many admiring glances from across the world as, depending on where you end up, you could be within an hour’s drive of fjords, mountains, and forests. 

The prices explained 

The website Finn.no lists almost every property for sale in the country. After a few searches, it will quickly become apparent that homes in rural Norway seem like excellent value. 

Using figures from the property firm Krogsveen, the average cost of property per square metre in Oslo is 89,000 kroner, the national average is 50,674 kroner, and in Møre og Romsdal in western Norway, the average cost is much lower at 28,722 kroner. 

Møre og Romsdal is one of Norway’s more remote counties, home to stunning regions like Sunnmøre and Sunnfjord.

READ ALSO: How much does an apartment in Norway cost?

This illustrates how much more you can get for your money in rural parts of Norway compared to elsewhere.  

There are some reasons for the price differences. Firstly, some homes in rural areas require full-time residence. If you plan on moving full-time, this won’t be an issue. 

If you are after a holiday home, this will be a barrier. Prices are typically higher in areas that are popular with leisure property owners. 

Some of the cheaper homes will be “fixer uppers”, even if you want to keep the home’s original charm. Bathrooms, kitchens, plumbing and electrics can all be incredibly expensive. 

Furthermore, investing in these areas of the home is unlikely to directly increase the property’s value due to the low demand. 

Farms should be avoided 

The charm of a Norwegian farm is difficult to avoid, lots of room, a large welcoming home and bright red farm buildings. 

However, these buildings are worth avoiding unless you intend to use the property for farming. 

Rules on the ownership of agricultural properties date back more than 1,000 years, and there are a few key things to be aware of. 

Firstly, you will need to live on the property full-time and typically use it for its intended purpose: farming. You will also need to apply for a license to own the property. This is part of a government act to protect agricultural land. Then, there are a number of special rules to ensure that some farms remain in a family line. 

Farming in Norway isn’t a particularly profitable venture either, so taking over a farm may not be as attractive once all the rules are laid out. 

The rules for foreigners buying rural properties 

Norway’s property market has no restrictions on whether foreigners can buy property. 

This means you can buy a property in Norway’s stunning rural regions. However, there are several practical obstacles. 

Most practical issues don’t apply to full-time residents. 

However, non-residents can’t get a Norwegian mortgage as they have ties and income to the country. 

Furthermore, not having an electronic ID and identity number will make it quite difficult to put in bids on homes, set up utility bills for the property, and get a bank account to pay these bills. 

If you manage to purchase a place, you can obtain a D-number from the Norwegian Tax Administration to try to open bank accounts and pay bills. 

Other practical info

For starters, you will likely need access to a car if you buy a place in the countryside. 

Owning a car will be crucial for reaching amenities, and depending on how remote you choose to go, you could end up a 30-minute drive away or need a car suitable for tackling difficult terrain to reach main roads. 

You’ll also depend on a car to get to and from work and to ferry kids to school and back. 

Houses in rural areas may also have much more expensive running costs. Older, larger properties are notorious for sky-high energy bills in the winter. 

Of course, finding a suitable job to match your career ambitions can be much more difficult in rural areas than in the bigger cities. 

READ MORE: The downsides of life in the Norwegian mountains you should know about

SHOW COMMENTS