Norwegian existing house prices grew 0.9 percent sequentially in August. The trend is still moderate; however, positive price growth with both demand and supply at high levels. Unadjusted prices were up 1.9 percent and the annual growth rate rose 0.9 percentage points to 2.6 percent in the month. Norges Bank had expected four-quarter growth to 1.32 percent in the third quarter. With unchanged prices in September, a four-quarter growth of 2.64 percent is expected in the third quarter, noted DNB Markets in a research report.
Fredrikstad/Sarpsborg saw the most robust annual growth, recording a year-on-year growth of 4.8 percent. Asker/Bærum recorded a growth of 3.9 percent, while Oslo and Tromsø both saw an annual growth of 3.8 percent. Stavenger saw the weakest growth of 0 percent.
Home turnover was 4.3 percent lower than August last year, while homes posted for sales were down 0.4 percent year-on-year. The number of unsold homes rose 18.8 percent from July, and is up by 4.5 percent from August last year to a high level in an historical perspective.
House price growth was above expectations in August, but after a decline in prices in July the trend is moderate, but positive price growth, as it had been for a while. Sales were high in August, suggesting that demand continues to be strong, while the number of unsold homes is still high in a historical perspective.
“We think the ample supply will continue to keep price growth muted ahead. Growth in Q3 looks set to be somewhat higher than Norges Bank’s projection in MPR 2-19. We don’t think this will be decisive for the policy rates at the upcoming meeting, as the housing market looks quite balanced at the moment and household credit growth is slowly abating”, added DNB Markets.
