Housing price statistics released by real estate organization Eiendom Norge on Wednesday showed only a small rise of 0.1 percent seasonally adjusted, but it was enough to keep prices at the current record high levels. The number of homes sold in the first five months of the year was also the highest ever recorded by the organization.
Prices were up 0.3 percent compared to last year’s record high month of May, reported newspaper Dagens Næringsliv (DN). “The record will be broken in 2015 and 2016,” predicted chief economist Kjell Senneset at Prognosesenteret. “Too few houses are still being built, something that will help ensure that housing supply remains low and the housing prices increase more than they otherwise would have done.”
Others were less optimistic, and said while the psychology of home buyers was difficult to predict, the 0.1 percent rise was a sign prices were stabilizing. “The thought that we have entered into a rapid price increase again has weakened slightly, as 0.1 percent is small,” said Professor Ola H Grytten from business university NHH. “The housing market is lying quite flat, and if anything I would have though the prices for May should have risen more. This is a sign that it is not easy to know what will happen in the future. I’m thinking a moderate growth, but it will go in fits and starts – and it can quickly turn.”
The figures also showed 9,217 houses (excluding new homes) had been sold in the first five months of 2013. “In May this year we have had a growth in total sales of 12 percent,” Eindom Norge’s chief executive Christian Dreyer told Norwegian Broadcasting (NRK). “It’s the second highest activity we have registered. Summed up so far this year, we have never sold so many existing homes in a year’s first five months.”
Dreyer said buyers were being more selective, with properties taking an average of 36 days to sell, up from the 28 day average last May. He did not expect prices would fall away again as they did in the second half of 2013, because there has been less new construction and a greater willingness by banks to lend.