Oslo has more than 6,000 fewer secondary homes than three years ago. – This contributes to a very tight rental market, says Carl O. of the Estate Agents Association.
– It is very difficult because many people are looking for a place. We have gone to several viewings and contacted the flats out there, but people rarely respond. It’s boring, 20-year-old Andrea Leidal-Thorvaldsson tells E24.
Together with her friend Selma Sophie Pache-Vick, she had been looking for a house to rent in Oslo for almost three months. They have been to several sightings but have not been caught yet.
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Two friends, Oskar and Baram, are not alone in their stressful situation when looking for a house in Oslo. The rental market in the country’s big cities is being ravaged by high demand, high prices and uncertain future prospects.
Over the past three years, the proportion of secondary homes has fallen in many places, new figures show in a report by the Norwegian Real Estate Association, Ambita and Socioeconomic Analysis.
Secondary homes are homes where you don’t have a permanent residence and can be rental homes, for example, or commuter homes. Homes owned by individuals, not rental companies, are mentioned in the report.
A lot fell
In the third quarter of 2019, the proportion of secondary housing in the total housing stock in Oslo was 17.5 percent, compared to 15.1 percent in the third quarter of this year, according to the report.
– The number of secondary homes has decreased nationally over time, but especially in Oslo. What you should know is that Oslo’s total housing stock has grown very little in recent years. Very little is being built and population growth is high. This contributes to a very tight rental market, says Carl O., CEO of the Norwegian Association of Real Estate Agents. Keeving told E24.
– This creates pressure on rental prices. He says the reason they’re rising is because there are so few rental properties.
Nationally, there were 7,260 fewer secondary homes in the second quarter than three years earlier, the report said. Oslo had 6,673 fewer secondary homes, while Stavanger had 438 fewer.
– In Oslo, Keeving says the rate has fallen in some years when there should have been growth.
He says that the main reason for this is the increase in interest costs, and the wealth tax on top of that.
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– Very expensive
According to Eiendom Norge, rental prices nationally rose by 9.3 percent in the past year. Rental prices have increased faster than inflation. Prices rose 1.5 percent in Oslo.
– It is very expensive. If I have to pay NOK 10,000, that’s more than I can borrow a month. If you have to pay for electricity, you have to work a little bit, says Andrea Leidal-Thorvaldsson.
Friends have been to several screenings and tell of great attendance. When Leidal-Thorvaldsen starts studying this fall, her friend is at work.
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– Depends on small investors
In Oslo, according to Utleiemegleren, 80 percent of the rental market consists of private homeowners.
– This negatively affects the rental market, says Siri Anne Bernum Halck, head of sales and business development at Utleiemegleren, about the decline in secondary housing.
He says that the prevailing policy today is that fewer people have invested in rental property and more people have sold.
– It means that we have lost a lot of secondary housing in Oslo. To have a well-regulated rental market, you also need to depend on small investors, he says.
Halk believes more, smaller homes should be built in disadvantaged areas so more young people can enter the market and buy a home.
– He says you also need to do something about property taxation on secondary housing to make it profitable to invest.
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The housing market in the capital is already tight, and there is now a risk that construction of new homes will almost stop. Opos, the country’s largest homebuilder, reported in August that it sold 58 percent fewer homes in the first half of the year.
– Very expensive
– If you want something like an eel, it’s very difficult to find it, says 23-year-old Anders Roolstad Eriksson.
He is one of many trying to break into the rental market in Oslo these days. Rullestad is moving to Oslo to finish his studies and start a permanent job.
– I think it is too expensive. Many places available for NOK 8,000-10,000 are not enough to justify the price, he says.
If he can’t find a place to live before he starts work in September, he plans to buy time through short-term rentals.
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