Building boom tapers off – High prices and rising interest rates are finally putting the brakes on Norway’s red-hot housing market

High prices and rising interest rates are finally putting the brakes on Norway’s red-hot housing market, and some experts are predicting an abrupt fall-off in construction activity.

Demand for housing remains high, note brokers, and now many Norwegians have their sights on investing in an extra home, to rent out.

Some prospective homebuyers have found themselves all alone at open houses the past week, meaning they haven’t had to throw themselves into bidding rounds for the property in question. “I’m beginning to hope that I can eventually cut a good deal,” one young woman told newspaper Aftenposten last week.

Demand for housing remains strong, but some developers have found themselves sitting with unsold flats at the high end of the market. The real demand, it seems, is for more moderately priced homes for young families, not just the small, expensive, urban apartments that seemed to offer the most profit potential for developers.

Planning officials in Oslo, Bergen and Trondheim already have seen a downturn in the number of new rezoning cases coming in. Fewer rezoning cases mean less building over the next few years, reports newspaper Dagens Næringsliv.

Building activity has remained high this year, as has remodelling activity, but architect firms are reporting fewer new residential and commercial projects coming in.

Fresh statistics from real estate brokerages have shown a slight fall in prices this fall. Most argue, however, that the market remains strong and may just be in the midst of a so-called “correction.”

By Nina Berglund

Lifted and published by API*APN africanpress@chello.no source.aftenposteneng