EIENDOMSVERDI The housing market update – July 2016

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Executive summary • Being both the holiday month as well as the time where college and

university intakes are being announced, we interpret July statistics with caution • The market in July grew by 0.2 percent nominally, and 1.0 percent • • • •

seasonally adjusted Volumes were generally low both compared to previous months as well as compared to previous Julys Unsold stock is below levels for previous years in Oslo and Trondheim and is now also falling in Stavanger Price growth for apartments higher in Trondheim than Oslo this month Record high sell/ask spread for Oslo at 15.3 percent

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The monthly housing market update

03.08.2016

2

July – up 0.2 percent; up 1.0 percent seasonally adjusted

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The monthly housing market update

Year/Year growth rate now at 8.8%

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The Norwegian Housing Price Statistics summary: • The market in July continued to grow 0.2 percent nominally, copying last

month growth rate • Seasonally adjusted prices increased by 1.0 percent • This is a strong growth for the month of July, July typically sees negative nominal growth rates • Year/Year growth now at 8.8 percent, jumping from 7.3 last month Index

Table 1. Summary The Nowegian Housing Price Statistics Index (Jan 03 = 100)

243,0

Change

July-16

0,2 %

Change

July-15

-1,1 %

Change

July-14

0,1 %

Change

June-16

0,2 %

Change

May-16

1,1 %

Year over Year

8,8 %

5 Years

33,4 %

Price Change since all time high

0,0 %

Price Change since previous trough

23,1 %

Source: Eiendom Norge, Finn.no, Eiendomsverdi Copyright © Eiendomsverdi ®

The monthly housing market update

The Norwegian Housing Price Statistics, segmented by housing type

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Housing prices by housing type • July gave wildly different developments for each segment • Terraced and detached fell with 4.1 and 2.3 percent, while apartments

grew 2.2 percent • Although the differences seem stark, this is quite typical for the month of July. Markets for detached and terraced are often thin, while apartments in the cities usually see quite strong growth rates in part because of admissions to colleges and universities being published Table 2. Summary by property type Index (Jan 03 = 100)

Detached 227,7

Terraced Apartments 232,4 252,1

Change

July-16

-2,3 %

-4,1 %

2,2 %

Change

July-15

-3,4 %

-3,1 %

0,4 %

Change

July-14

-0,6 %

-0,1 %

0,6 %

Change

June-16

-1,2 %

1,2 %

0,6 %

Change

May-16

0,9 %

-0,4 %

1,6 %

6,3 %

5,2 %

10,5 %

24,5 %

23,9 %

40,0 %

Price Change since all time high

-3,5 %

-4,1 %

0,0 %

Price Change since previous Trough

17,4 %

13,8 %

27,9 %

Year over Year 5 Years

Source: Eiendom Norge, Finn.no, Eiendomsverdi Copyright © Eiendomsverdi ®

The monthly housing market update

The Nowegian Housing Price Statistics by county

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Housing prices for selected counties • Oslo, Hordaland and Sør-Trøndelag are the only counties experiencing

growth this month • Oslo is yet again the best performing county with growth rate at 1.8 percent, prices in Oslo are now 50 percent higher than they were 5 years ago Table 3. Summary by selected counties Index (Jan 03 = 100)

Oslo Hordaland Sør-Trøndelag 264,1 267,3 260,4

Change

July-16

1,8 %

0,1 %

0,5 %

-1,1 %

-0,5 %

-1,1 %

-0,7 %

Change

July-15

0,2 %

-0,8 %

-0,9 %

-2,0 %

-1,7 %

-1,7 %

-1,7 %

Change

July-14

0,5 %

0,2 %

0,2 %

-0,2 %

-0,2 %

0,1 %

-0,3 %

Change

June-16

1,3 %

-0,5 %

0,1 %

-1,2 %

-0,4 %

-0,5 %

-0,4 %

Change

May-16

2,2 %

0,4 %

1,0 %

-0,5 %

1,1 %

0,1 %

1,5 %

Year over Year

15,2 %

4,3 %

7,4 %

-3,1 %

8,3 %

3,1 %

9,0 %

5 Years

50,1 %

30,2 %

37,1 %

7,3 %

33,4 %

8,3 %

30,3 %

0,0 %

-0,4 %

0,0 %

-7,0 %

-0,8 %

-1,6 %

-1,1 %

35,8 %

20,6 %

21,0 %

-0,3 %

21,9 %

12,7 %

24,4 %

Price Change since all time high Price Change since previous Trough

Rogaland 258,4

Nordland Vest-Agder 260,2 223,3

Source: Eiendom Norge, Finn.no, Eiendomsverdi Copyright © Eiendomsverdi ®

The monthly housing market update

Hedmark 229,0

Apartments in selected cities

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Summary apartments in the big cities • Trondheim ahead of Oslo this month with a 2.3 percent growth rate for

apartments in July • Oslo’s year over year growth for apartments is now at 15.5 percent • Positive signs from Stavanger, with apartments increasing by 1.6 percent. The growth is not echoed by other estate types • Drammen continues to grow, prices for apartments are now 12 percent higher than a year ago Table 4. Summary apartments big cities Index (Jan 03 = 100)

Oslo 265,7

Bergen 275,6

Trondheim 260,7

Stavanger 266,2

Kristiansand 227,8

Tromsø 262,9

Drammen 275,0

Bodø 254,4

Change

July-16

2,2 %

1,8 %

2,3 %

1,6 %

1,9 %

1,8 %

2,1 %

1,8 %

Change

July-15

0,5 %

0,5 %

0,4 %

-0,3 %

0,0 %

0,7 %

0,2 %

0,3 %

Change

July-14

0,6 %

0,7 %

0,5 %

0,3 %

0,8 %

1,4 %

0,6 %

0,8 %

Change

June-16

1,3 %

-0,3 %

0,4 %

-1,0 %

0,0 %

0,1 %

0,8 %

-0,1 %

Change

May-16

2,3 %

0,6 %

1,3 %

-0,7 %

0,7 %

0,8 %

1,8 %

1,3 %

Year over Year

15,5 %

3,8 %

7,6 %

-5,6 %

4,6 %

4,7 %

12,0 %

9,0 %

5 Years

51,9 %

33,7 %

38,3 %

3,8 %

9,2 %

53,7 %

53,1 %

45,7 %

0,0 %

0,0 %

0,0 %

-9,8 %

0,0 %

0,0 %

0,0 %

0,0 %

36,9 %

22,9 %

21,4 %

-2,8 %

16,8 %

33,2 %

29,5 %

28,8 %

Price Change since all time high Price Change since previous Trough

Source: Eiendom Norge, Finn.no, Eiendomsverdi Copyright © Eiendomsverdi ®

The monthly housing market update

Unsold stock

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Unsold stock in Oslo and Bergen

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Unsold stock in Trondheim and Stavanger Area

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Age of inventory in July (unsold stock)

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Volumes in July

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Year to date volumes

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Time on the market

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Prices in Norway, UK, Sweden, Denmark and the USA

Source: S&P Case-Shiller Home Price Indices Composite 20, Realkredittrådet, Hometrack, Statistics Sweden, Eiendomsverdi Copyright © Eiendomsverdi ®

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Sell/ask spread for Norway: 2,4 percent

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The sell-ask spread in Oslo, Trondheim, Bergen and Stavanger

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Sell-ask spread in Tromsø, Drammen, Kristiansand and Bodø

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Summary of the sell-ask spread • Sell/ask spreads usually fall in July, a development we also experienced this year

with the national sell/ask spread now at 2.4 percent, the lowest so far in 2016 • Oslo on the other hand set a new record this July with a staggering 15.3 percent sell/ask spread • Stavanger worsened its spread last month, but is this month at – 3.6 percent, the best since August last year • Drammen yet again strong, but fell from last month

Table 5. Summary (Final Selling Price Ask Price) / Ask Price July-16 Average All-time high Date All time high (2005-2016) All-time low Date All time low (2005-2016) Source: Eiendomsverdi Copyright © Eiendomsverdi ®

Oslo 15,3 %

Bergen 3,4 %

Trondheim 3,9 %

Stavanger -3,6 %

Kristiansand -2,0 %

Tromsø 0,1 %

Drammen 4,6 %

Bodø -1,0 %

Norway 2,4 %

5,3 % 15,3 % jul. 16

4,4 % 11,8 % jan. 05

2,6 % 7,9 % feb. 13

1,5 % 10,2 % aug. 06

1,2 % 10,0 % feb. 07

-0,4 % 4,1 % feb. 07

2,5 % 8,2 % jan. 13

1,6 % 6,2 % aug. 06

2,3 % 6,3 % aug. 06

-6,4 % des. 08

-5,0 % des. 08

-5,8 % nov. 08

-5,9 % nov. 08

-7,1 % des. 08

-9,0 % okt. 08

-3,2 % jan. 09

-7,7 % des. 08

-5,7 % des. 08

The monthly housing market update

Housing starts in Norway for June

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The monthly housing market update

Source:SSB

12 month rolling rate

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The monthly housing market update

Source:SSB

Eiendomsverdi’s estimates: transaction prices over-estimated by 0.6 % 4,0 %

3,0 %

2,0 %

1,0 %

0,0 %

-1,0 %

-2,0 %

-3,0 %

-4,0 %

The monthly housing market update

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-5,0 % 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016 Source:SSB

Contact information Eiendomsverdi AS Trelastgaten 3 PB. 1052 Sentrum, N- 0104 Oslo Tel: 23 00 28 20 Fax: 23 00 28 30 [email protected] www.eiendomsverdi.no

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Housing Research Anders Lund Tel: 23 00 28 37 E-mail: [email protected]

Housing Research Audun Houmb Sjøli Tel: 23 00 28 20 E-mail: [email protected]

The monthly housing market update