April 5, 2018 / 11:26 AM / a year ago

UPDATE 1-Norway's housing prices rose further in March

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OSLO, April 5 (Reuters) - Norwegian housing prices rose for a second consecutive month in March, boosted by strong demand for homes in the capital, although the first quarter still suffered its weakest performance in a decade, real estate industry data showed.

Seasonally adjusted housing prices rose by 0.2 percent in March from February, with an unadjusted increase of 0.5 percent. On a year-on-year basis prices fell by 2.2 percent, Real Estate Norway said in its monthly report on Thursday.

Tighter mortgage regulations, lower population growth and a boom in construction have contributed to a fall in prices from a peak in March of 2017.

“We expect a moderate increase in the 12-month growth rate going forward to a level of around zero by the end of the year, Real Estate Norway Chief Executive Christian Dreyer told Reuters.

If a recent trend of higher-than-expected prices in the Oslo market continues, this could however further pull up the national average, he added.

Nordea Markets’ economist Erik Bruce said the March data supported a view that Norway’s housing market downturn has ended, and was “well in line” with the Norwegian central bank’s plan to hike rates in September.

The housing data was compiled by Real Estate Norway, FINN and Eiendomsverdi. (Reporting by Camilla Knudsen, editing by Terje Solsvik)

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