May 4, 2018 / 9:25 AM / 2 months ago

UPDATE 1-Norway's housing prices continued to rise in April

(Adds analyst)

OSLO, May 4 (Reuters) - Norwegian seasonally adjusted housing prices rose by 0.9 percent in April from March, a real estate industry association said in a monthly report on Friday.

On a year-on-year basis prices fell by 1.0 percent in April, Real Estate Norway said, while adding that the annual change was on track to turn positive by the end of June.

Prices have recently shown signs of recovery from a correction driven by tighter mortgage regulations, lower population growth and a boom in construction that resulted in a fall from a peak hit in March 2017.

The April price increase was stronger than expected, brokerage Handelsbanken said, adding that it clearly exceeded projections made by the central bank.

“On the other hand, household debt growth has been weaker than expected. But taken together, financial stability concerns may have increased somewhat,” Handelsbanken wrote in a note to clients.

“We stick to our conclusion that the key interest rate will be lifted in September, by 25 basis points,” it said, in line with a view expressed by the central bank.

Unadjusted prices rose by 1.8 percent in April from March. The housing data was compiled by Real Estate Norway, FINN and Eiendomsverdi. (Reporting by Camilla Knudsen, editing by Terje Solsvik)

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