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STUDYING IN NORWAY

‘Deeply concerning’: Is Airbnb eating away Norway’s student housing supply?

With more than 12,000 students in Norway still waiting for housing, finding a place to live in major cities has become a challenge for young people. At the same time, short-term rentals to tourists are on the rise.

Oslo home
The number of secondary homes on the market in Norway, including rental properties, is decreasing. Photo by Mathilde Ro on Unsplash

As of August 15th, 12,590 students were still in the queue for student accommodation, according to recent data from the Association of Norwegian Student Welfare Organisations (Samskipnadsrådet).

At the time of writing, Oslo has the longest waiting list, with 5,800 students.

READ MORE: The cities in Norway with the worst student housing queues

The shortage is so severe that reading rooms and canteens in Oslo and Bergen have been converted into temporary dormitories.

The Norwegian Student Organisation (NSO) has declared this a housing crisis and is calling for urgent action.

Simultaneously, figures from the Norwegian Tax Administration and analysis agency Capia AS, reported by the Norwegian Broadcasting Corporation (NRK), reveal that the increase in short-term rentals to tourists is reducing the availability of homes that traditionally served students.

What do the numbers say?

In Bergen, Norway’s second-largest city, rental income from Airbnb has skyrocketed by 171 percent from 2022 to 2024.

Oslo has seen a 135 percent increase over the same period.

Last year, professional rental operators in Norway earned 11 billion kroner through Airbnb and similar platforms.

Meanwhile, the number of secondary homes, including rental properties, on the market dropped by 1.8 percent between 2019 and 2024, according to the Norwegian Association of Estate Agents.

A ‘deeply concerning’ shift

The shift from long-term to short-term rentals in major cities and tourist destinations is ‘deeply concerning,’ Anne-Rita Andal, the manager of the Leieboerforeningen tenant interest organisation, told The Local Norway.

“It shows a serious deficiency in our housing politics, and it is a result of an almost completely marked-based policy,” she said.

Andal pointed out that when landlords find short-term rentals like Airbnb more profitable, the consequences for tenants and cities can be significant.

“But the consequences for tenants and for the cities as a whole are huge, and we need to take a serious look at how to prevent this shift,” she warned.

READ MORE: How to get student housing in Norway as an international student

Morten Andreas Meyer, the general secretary of the nationwide homeowner interest organisation Huseierne, echoed these concerns.

“We have seen this coming and are worried about this trend. Livable cities and communities need a sustainable private rental market where long-term rentals are prioritised,” Meyer told The Local.

“It’s problematic when rental properties for students are effectively turned into hotel rooms.”

Major cities and tourist spots most affected

This shift is most pronounced in areas where demand for short-term rentals has surged. Both Andal and Meyer agree that Oslo and Bergen are among the hardest hit.

“Oslo and Bergen are perhaps the most affected, but it’s also troubling that this is happening in small tourist towns in rural Norway,” Andal said.

Meyer added, “Oslo and Bergen are popular for both living and visiting, and we’ve seen a significant increase in Airbnb revenues in these cities. At the same time, long-term rentals have decreased, making it less attractive and profitable to rent out property in Norway.”

He attributed this trend to rising housing costs and increased wealth tax on secondary dwellings.

The way forward

Leieboerforeningen sees the need for a closer look at the current Airbnb regulations in Norway.

“We must urgently reconsider the regulations around Airbnb. Are they good enough, or do they need changes? Are they being enforced?” Andal questioned.

She emphasised the need to separate housing from tourism more effectively and to rethink Norway’s profit-driven housing policies, suggesting a shift towards more tenant-friendly regulations.

“I believe the time has come to discuss a shift in our housing politics, a shift towards a more tenant-friendly politics that sets our basic human rights higher than we do today,” Andal told The Local.

Meyer, however, advocated for a more straightforward approach: “In short, the most important solution is to build more homes.”

The Local has an explainer on the rules for renting out your home on Airbnb in Norway, which you can find here.

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PROPERTY

What first-time buyers in Norway need to know about the current property market

Norway’s property market has outpaced expectations this year. From what will happen to prices and whether the lending regulations will change, here’s what potential buyers need to know.

What first-time buyers in Norway need to know about the current property market

By August 2024, the average cost of a home in Norway had risen to 4.75 million kroner. So far, house prices in Norway have risen by 8.3 percent.

However, thanks to wage rises this year, “real house prices” (which account for wage growth and other things) are at a similar level to 2017, interest organisation Real Estate Norway (Eiendom Norge) has said.

People are rushing to buy homes

Norway’s property market moves fast, but things have been especially fast-paced recently, according to estate agents.

In August 2024, it took an average of 42 days to sell a home. Furthermore, Real Estate Norway said that August saw more home sales than it had ever recorded in that month before.

Meanwhile, Martin Kiligitto, managing director at Nordvik Bolig, has told The Local that he expects the high activity to continue.

According to Carl O. Geving, the managing director of the Norwegian Association of Real Estate Agents (NEF), rising wages are one factor behind this trend. Salaries in Norway have started to rise following years of stagnation and high inflation.

READ MORE: House hunters in Norway rush to buy homes before price rises

The market is hotting up ahead of interest rate increases

Norway’s central bank brought the key policy rate to its peak at the end of last year, and cuts are expected to arrive in 2025.

Many who had been waiting on the sidelines to see whether rates would be raised further have now entered the market ahead of the cuts.

“Many potential buyers who have been waiting for a reduction in interest rates are now acting, likely driven by the expectation that prices will rise once the Central Bank of Norway announces a rate cut, which is anticipated in the first half of 2025,” Kiligitto said.

Prices are likely to continue rising over the next two years as mortgages become more affordable.

The second-hand market will be particularly tight

Norway hasn’t built enough houses to meet demand in recent years. Furthermore, increasing material costs and high interest rates have made new builds expensive.

These two factors have bottlenecked buyers into the second-hand home market.

“There is still a problem with the construction market and the sale of new homes. It is still expensive to build new homes, so there’s mainly heavy pressure on the market for used homes,” Geving told The Local recently.

He said the problem was biggest in Norway, where there was a large demand for small flats. Given how long it takes to build properties, this issue was likely to drag on for the foreseeable future. 

It appears as if lending rules will not change

In recent months, there has been speculation that Norway could loosen its lending regulations as the Finance Ministry was set to decide on new rules at the end of the year.

Among the predicted changes were tweaks to the equity required to buy a home. Currently, a minimum of 15 percent is required – although some banks ask for more from foreign customers.

The Financial Supervisory Authority of Norway, which supervises banks and other financial institutions, has appeared to scupper those hopes by saying that it would continue the current lending regulations in Norway.

This means that the deposit rate of 15 percent will continue, as will the borrowers being restricted to loans of five times their income minus any existing debts. Mortgage applicants will also have their finances tested against potential interest rate increases of three percentage points.

READ ALSO: What foreign residents in Norway need to know to get a mortgage

A lack of changes to the lending regulations has been criticised by Henning Lauridsen, the CEO of Eiendom Norge.

“Instead, the regulation has contributed to greater inequality in society and made vulnerable households even more vulnerable,” Lauridsen recently told business broadsheet Dagens Næringsliv (DN).

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