After two years of a red-hot cottage market, prices are now starting to stabilize in several places in the country.
– Sellers must expect lower prices for holiday homes in the future, says real estate agent at DNB, Christin Bechmann.
Among other things, she sells cabins at Hafjell, Skeikampen, Sjusjøen and Kvitfjell.
Put down half a million
During the last month, they have adjusted price indications down by up to 11.9 percent.
– Times are different now. It is moving towards a buyer’s market, says Bechmann.
She says that 75 per cent of the cabins have been sold below the asking price, while 25 per cent have been sold above.
– It is expected. The cottage market is on its way to stabilizing after corona.
A cabin at Skeikampen was put up for NOK 5,990,000 during the pandemic. The same cabin is now listed for half a million kroner less, and has still not been sold.
– The cabin has a very good location, right near an alpine resort. It is clear that sellers cannot expect to receive the same sums as during the corona, says Bechmann.
Areas that have felt the decline in the market to the greatest extent are Agder, Ringsaker and Eastern Norway in general.
“Increased interest rates and electricity costs probably have a little to do with purchasing power in the south of the country,” says senior analyst at the Prognosesenteret, Carl Christian Mathiesen.
According to Mathiesen, 28 per cent fewer cabins have been sold this year, compared to the same period last year.
– This is of course a significant decrease, but then 2020 and 2021 were completely exceptional years as far as the cottage market is concerned.
He reasons the decline with lower demand.
– People have probably bought themselves ready-made. Many jumped at the chance to buy a cottage during the pandemic.
– Continued general price growth
Despite the fact that some municipalities are already noticing a drop in prices for holiday homes, the general analysis is that the market is doing well.
– We have had a price increase of a total of 30 per cent since 2019, and up 11 per cent since last year, says Mathiesen.
– Monthly prices in the last eight months of this year have been higher than at the same time last year.
Can be violent
However, Mathiesen is not so sure that the cottage market will remain at a similar level to 2018 and 2019.
– Many will have to sell their cabins for the winter if the high electricity costs persist.
– I wouldn’t say that there could be a crash in the cottage market, but there could certainly be a significant decline if many have to sell.
He says that many cabin owners do not necessarily have good enough finances to get through a winter with sky-high electricity prices.
– Many have large loans and a third of the cottage owners are of retirement age (67+). The increasing expenses can be decisive.
The two biggest barriers to buying a holiday home right now are high electricity costs and high lending rates.
This is shown by a survey carried out by the Prognosesenteret.
– Lower purchasing power and many cabins on the market can push prices down significantly. Unless I had to, I wouldn’t have invested in selling my cabin this winter, says Mathiesen.