– Gives Norges Bank good cards in hand – E24

The rise in house prices may make it easier for Norges Bank to postpone interest rate cuts, according to a senior economist.

The case is updated.

Senior economist Sara Midtgaard says that housing price growth was stronger than she had expected, and also stronger than Norges Bank’s forecasts.

– If anything, this gives Norges Bank good cards in hand to delay interest rate cuts. That does not prevent Norges Bank from postponing interest rate cuts until December, she tells E24.

House prices rose by 1.2 per cent in April from the previous month, Eiendom Norge’s statistics show.

Adjusted for seasonal variations, prices were up 0.7 per cent. So far this year, house prices in this country have risen by 7.2 per cent.

– Full speed

The figures from Eiendom Norge show that 9,942 homes were sold in April, which was 43 per cent more than in the same month last year.

Midtgaard says that the average for a typical April has been around 7,700 homes.

– The second-hand housing market is at full speed. You can see that the transaction volume is at an abnormally high level in April.

– There is a good balance in the second-hand housing market now. The transaction volume is picking up well, but so is the number of homes put on the market, says Midtgaard.

In April, 10,881 homes were listed for sale, an increase of 12 per cent compared to April last year.

– There is high activity when we look at both the supply and demand side. And house prices continue to skyrocket, says Midtgaard.

She also points out that expectations for housing prices in the future have risen.

– There has probably become an expectation among many now that the interest rate peak has now been reached. There is more predictability.

Midtgaard also highlights other conditions that sustain the activity. She says there are many in the age groups between 50 and 60, and in their 30s.

– The common denominator in these two cohorts is that they are in a phase of life change, where there is a need to change homes. For several years to come, activity will probably be high, due to demographic conditions.

– Many will need to either downgrade or upgrade to a larger home, says Midtgaard.

– Doesn’t seem to scare home buyers

Randi Marjamaa, head of personal market at Nordea, says in a statement that the bank is “experiencing a large demand for financing certificates”.

– Although there are many indications that the interest rate level will remain unchanged for longer than many thought early this winter, it does not seem to scare home buyers away.

Marjamaa points to “especially great interest in mortgages from young first-time buyers”.

– While there are quick sales and a good temperature in bidding rounds for small, central apartments, there is a somewhat slower market for homes from NOK 8-10 million and upwards.

– The customers here say that they can take more time in the buying process, and some homes in these segments are also sold below the asking price.