While there are reports of unusually strong growth in house prices, warns the International Monetary Fund (IMF) once again and says the Norwegian housing market is greatly overpriced.
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Tuesday la fund a report on Norwegian economy where it warns that “the high and rising house prices and household debt in Norway poses a significant risk to financial stability,” writes Aftenposten. IMF believes the housing market at year-end were overpriced by 40 percent.
The Fund notes that housing prices have increased by 140 percent since 2000, twice as much as the general rise in prices.
More reasons
in addition, the debt to a Norwegian average family increased from 145 percent of disposable income in 2002 to 220 percent last year, which is higher than in most comparable countries.
the reasons for the development attributed to low unemployment and low interest rates and large tax benefits by putting their money in housing over other investments.
In addition, the population growth and migration to cities to drive prices upwards. The same regulations that dampen housing construction, writes the IMF report said.
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