January 4, 2018 / 10:37 AM / a year ago

UPDATE 1-Norway's housing prices down 0.5 pct S/A in December

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OSLO, Jan 4 (Reuters) - Norwegian seasonally adjusted housing prices fell by 0.5 percent in December from November, a real estate industry association said in a monthly report on Thursday.

On a year-on-year basis prices fell by 2.1 percent in December, Real Estate Norway said, marking the first time since 2013 that full-year prices were weaker then the previous year.

Tighter mortgage regulations, lower population growth and a boom in construction have all contributed to weaker demand for housing in recent months.

From an April 2017 all-time-high, prices are down some 6.7 percent nationwide, and by a sharper 11.5 percent in Oslo.

“The (December) drop is in line with the trend and there is no sign of the downturn intensifying,” Nordea Markets wrote in a note to clients, adding that the December fall was probably slightly smaller than the central bank’s forecast for the month.

“We stick to our view that prices have somewhat more to fall before prices stabilize in the spring ... The rather moderate drop we foresee will not threaten the upswing in the Norwegian economy,” the brokerage added.

Unadjusted prices fell by 1.1 percent in December from November. The housing data was compiled by Real Estate Norway, FINN and Eiendomsverdi. (Reporting by Oslo newsroom, editing by Terje Solsvik)

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