Owning your own home in Norway has become 45 per cent more expensive in two years

Statistics Norway (SSB) has released new figures showing how much money people in Norway spend on housing.

On average, a household that owns its own home has a total of NOK 176,000 (16,000 USD) in housing expenses in 2023.

But this number hides large differences.

Increased interest expenses

Two years ago, Norges Bank's key policy rate was at 0 per cent.

Thus, it is largely increased interest rates that have driven up costs for those who own their own home.

At the same time, people's mortgage payments have decreased. Many are trying to keep housing expenses down in this way.

SSB’s figures show that 70 per cent of homeowners have a mortgage. One in three has a loan of over NOK 2 million (182,000 USD). The highest among borrowed for housing is in Norway’s capital Oslo.

Paying smaller instalments

“Homeowners with mortgages paid an average of NOK 42,900 (3,910 USD) per year in interest in 2021, compared to NOK 85,700 (7,819 USD) in 2023,” Kristina Støren of SSB says in a press release.

Many are ‘solving’ this by paying smaller instalments on their loans.

SSB’s figures show that people are paying 26 per cent less in mortgage instalments in 2023, compared to two years earlier.

Converted to monthly costs, the interest costs for an average mortgage have increased from NOK 3,600 (340 USD) in 2021 to NOK 7,100 (675 USD) in 2023.

Most expensive for families with children

Households with children have the highest total housing expenses. The expenses are most burdensome for single parents.

Couples with children now have average annual housing expenses of NOK 249,900 (23,730 USD). In 2023, single parents face average housing expenses of NOK 179,600 (17,060 USD).

SSB’s 2022 figures showed that 27 per cent of all single people with children then spent at least 40 per cent of their income on housing.

Costs for those who rent

If people rent a property from others, the latest figures from SSB show that roughly 20 per cent live in a property that belongs to family or friends.

About 70 per cent rent from private individuals, and about 10 per cent rent from professional landlords.

Tenants who pay standard market rent now have an average annual housing expense of NOK 124,000 (11,780 USD) in 2023 for rent, electricity, and heating.

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Translated by Alette Bjordal Gjellesvik

Read the Norwegian version of this article on forskning.no

References:

Oppøyen, M.S.: Kraftig økning i bokostnader for boligeiere (Significant increase in housing costs for homeowners). Statistics Norway, 2023.

Levekårsundersøkelsen 2023 (Living conditions survey 2023). Statistics Norway, 2023.