Norway’s economy returns to growth, real estate market gains momentum
Improved domestic demand on the back of easing pandemic restrictions led to Norway’s economy posting its biggest quarterly expansion since at least 1990.
According to property investment website Global Property Guide, Norway’s GDP grew by 4.6% in the third quarter of 2020 compared to a 4.7% contraction in the previous quarter, as the country gradually eased pandemic-induced restrictions.
Norway’s property market also recovered, shrugging off three years of weakness. The inflation-adjusted nationwide house price index rose by 2.89% in the third quarter of 2020 compared to a year earlier, marking its best year-on-year performance since the second quarter of 2017. On a quarterly basis, house prices rose marginally by 0.62% in Q3 2020.
Demand for residential property gained momentum following a temporary slowdown in early 2020. Residential real estate sales rose by 6.1% in the third quarter, with 27,000 more units sold versus a year earlier, according to Statistics Norway.
One factor that had led to slower growth in Norway’s property market in recent years was the implementation of stricter mortgage rules from January 1, 2017, which focused on restraining house prices in Oslo.