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Thursday, May 23, 2024

No drastic changes in mortgage requirements

Finance Minister Siv Jensen says there’s still reason for concern about Norway’s high housing prices and overheated real estate market, but she opted against making any major changes in qualification demands for home mortgages.

Jensen instead chose to caution that if the banks themselves don’t put a damper on their lending activity, she may introduce new measures that would make it harder to qualify for a loan. In the meantime, she didn’t follow the advice of state financial regulators’ advice to demand that borrowers be able to tolerate interest rates of up to 6 percent.

She instead proposed allowing banks to exempt some borrowers from a demand introduced by the previous Labour party-led government to make at least a down payment of 15 percent, for up to 10 percent of all money they lend out.

“It’s important to approach (capital demands) carefully,” Jensen said. “State authorities can over-regulate and make things go from bad to worse.” Norway’s central bank board is expected, meanwhile, to lower interest rates at its last upcoming meeting before the summer holidays. staff



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