– After the fall in interest rates, there have been very good times for first-time buyers, says CEO. Carl O. Geving in the Norwegian Real Estate Association in a press release.
Carl O. Geving is CEO of the Norwegian Real Estate Association.
Photo: Ole Jørgen Kolstadbråten / NRK
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The corona year 2020 brought with it a lot of economic turbulence for home buyers. Partial closure of the country led to redundancies and layoffs.
In isolation, this should indicate that it became more difficult to buy a home for the first time. But one of the coronation measures worked strongly in their favor, it is said in a new report.
On 7 May, Norges Bank set the key policy rate down to zero.
– Very low interest rates after the corona outbreak provide strong incentives to buy rather than rent a home. This has triggered strong price growth, especially in the Oslo region, the Norwegian Real Estate Association writes in a press release.
The quarter after the zero interest rate was set, ie the third quarter of 2020, the highest number of first-time buyers was registered in one quarter since the statistics started in 2008.
If you look at the whole year, you have to go back to 2011 to find a higher number than in 2020.
Rise in the big cities
Several of the large cities are experiencing an increasing number of first-time buyers.
I Bergen there was a clear increase in 2020. I Kristiansand saw much of the same, especially in the second half of last year.
Trondheim The number of first-time buyers has increased steadily for several years, and the development was further strengthened last year.
Also in Tromsø, where the numbers have varied a lot from year to year, there was a recovery in 2020.
The brake can come now
One of the side effects of low interest rates has been rapidly rising house prices. Precisely the latter will mean that the growth in the number of first-time buyers will flatten out, the analysis states.
– As the interest rate effect decreases, the housing market will fall back to more normal conditions and we believe that the increase in first-time buyers will decrease in most regions, says Geving.
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