New home sales have slumped in Norway, falling 34 percent in the last quarter of 2013 compared to the same time last year. The biggest drop came in Oslo, which suffered a relative decrease of 47 percent.
The 2013 full year sales figures were down by 12 percent on the previous year, reported newspaper Dagens Næringsliv (DN). New home construction was down six percent. The report by the Home Builders Association (Boligprodusentenes Forening) blamed high prices as the main reason for the decline in Oslo, saying only the most wealthy can afford to buy news homes.
The Association’s chief, Per Jæger said the slump should be viewed in light of banks increasing the requirement for advanced sales on new housing projects, and the Norwegian State Housing Bank (Husbanken) running out of money for basic loans, home loans, and new warranty provisions for residential builders.
Several housing developers told Norwegian Broadcasting (NRK) they have not postponed any projects for fear new homes will go unsold. “We seen that the sales process needs a little more time and effort per unit to get a sale,” said Kjell Kvarekvål from developer JM. “It’s going more slowly, but there’s life in the market.”
Baard Schumann from Selvaag Bolig told NRK 80 percent of their apartments under construction are already sold, and it’s easier to sell homes nearing completion than those still on the drawing board. Unsold homes are rented out. “What’s more uncertain is whether we’ll sell enough homes to begin new projects,” he said.