Through several decades in the Norwegian housing industry, I have always been concerned that the housing market should not be exclusionary. Owning your own home has enormous importance for the individual’s personal security and finances, and should therefore be something most people have the opportunity to do. The earlier you can get a foothold in the housing market, the better. One of the biggest drivers of economic differences today is how early one becomes a home owner. A forty-year-old who entered the housing market in 2009 has experienced fifteen years of house price growth, low interest rates and has paid off loans along the way. It is also a form of savings. A forty-year-old who never entered the housing market has, at the same time, primarily paid rent to someone else. In addition, it is good for all of us if more people can buy housing, because a well-functioning housing market requires circulation in the market. First-time entrants are important to curb price inflation. The housing market acts as a ladder. You usually start at the lowest level (i.e. the cheapest home), and then you go up the levels as loans are paid off and wages increase. But that requires that enough people enter on the bottom rung, otherwise there will be no movement on the ladder. Those who have climbed to the top and have a paid-off detached house, but want to move into a new flat in their old age, risk not being able to sell, because there are not enough buyers. Alternatively, they do not get a price for the detached house that makes it possible to buy the flat they want. As a pensioner in my own home, I am personally well off, but look with great concern at the development of young people. According to Statistics Norway, around one in four received help from their parents to buy a home in 2023. At the other end of the scale, the proportion who rent has increased by 3 percentage points since 2012. Almost every fourth household rents the home they live in, and the youngest rent the most. It is a clear expression of a class divide between those who have a “family bank” to borrow from, and those who do not. The Norwegian Financial Supervisory Authority has over time tightened the requirements for equity capital. This has made it more difficult to save up the necessary equity for young people who do not have access to financial support from the family. This is especially true in the big cities, where rental prices over time at least increase in line with house prices, and make it even more difficult to save for equity. The outlook ahead is also bleak. House prices have, given the economic times we live in, remained remarkably stable. But the construction of new homes has fallen to record low levels. The construction industry carries out layoffs and dismissals. This means that a lot of foreign labor is leaving Norway. Many will not return. So when people feel confident that interest rates have peaked and demand is increasing, we will be short of labor The combination of too few available homes, high demand and poor access to labor means we are facing a sharp rebound in house prices (and rents). To the delight of all who already own (and rent). But it will also result in even more young people being referred to the rental market. At worst, they remain there forever. We saw the first sign of the price rebound when the house price statistics for January were published. So what can one do? There is at least one thing that will have great and real significance, and that is to change the start-up loan scheme so that young people are also prioritized – as was the case before. For young people who have the ability to service loans, but do not have a family bank to turn to for equity, the state-owned Husbanken should stand up. Not by giving away equity, but by putting up the part of the loan that you don’t get from private banks. The risk is primarily borne by the authorities, since the private bank is first in the queue with security in the loan. Another important change is that you should be able to use loans on both new and used homes. Today, Husbanklån is not usually granted for second-hand homes. The timing for implementing these changes is favorable for several reasons. We are close to or past the interest rate peak, while the labor market is solid and stable. This means that the risk is relatively low for default on start-up loans that are granted in the future. Of course, it will never be completely risk-free, not even for the regular banks. Home bank loans must be a social instrument. But it must be adjusted in such a way that it gives as many people as possible the opportunity to enter the housing market, and that it helps to equalize economic differences. Then the framework must be expanded significantly, and the young must be prioritized. Per Jæger is the former managing director of Boligproduktorene, an interest organization for housing-producing companies in Norway. The association’s activities are particularly aimed at business policy issues and developments within housing construction.
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The financially orphaned – Statement
