Buying a Property in Oslo

There are no restrictions against foreigners purchasing property in Norway. It is generally considered good business to purchase property in Norway if you plan to stay for a while. Values have been going up steadily in the past decade and are not expected to fall. There was a small blip during the 2008 crisis, but prices bounced right back. With the high cost of rental, it makes more sense to buy if you can afford to.

Looking for homes on the Internet is one of the easiest, and most common ways, of looking for available properties. This gives you an overview of what's on the market as well as gives a scope of price range. Some of the sites are:

 

• www.finn.no (Norwegian)
• www.ezilon.com/norway-real-estate.html
• www.viviun.com/Real_Estate/Norway
• realestate.classifieds1000.com/Norway
• www.4321.co.il/property/norway_property.asp

Financing

It is common to take out a mortgage (housing loan) that is paid back with interest over a period of 15-20 years. If it is difficult to obtain a bank loan, you can apply for a municipal loan through the housing office in your bydel (neighbourhood). The Housing Bank (www.husbanken.no) is a large agency that offers loans, grants and guidance about buying property in Norway. They also inform buyers about new initiatives and developments.

Oslo has no property tax, though every sale is subject to a one-time 2.5 percent transfer tax, called a document fee.  In addition, a lien is typically placed on a property immediately after the sale is completed, for a charge of around 1,500 NOK. Once ownership of a property is officially transferred, the lien is removed, and a fee of about 1,900 NOK is levied for the title of deed.

Typically you pay 20% down payment on the property. Your interest rate will change depending on how much you put down as a down payment. Young people buying their first property can get a lower interest rate as well. There will be additional fees but theses vary according to property type. You should ask your real estate agent what applies to the property in question.

Holiday homes are subject to an additional yearly tax of 2.5 percent of the properties assessed value. If the property is to be used exclusively for letting, it will be considered a business and the profit will be taxed at a rate of 28 percent. If sold, the profit is tax free if owned for more than five years.

Estate Agents

You normally go through a real estate agent when purchasing a home. Most property sold in Oslo is handled through a real estate agency. They undergo special training, and are subject to strict rules and control routines on the part of the authorities.

Norwegian estate agents are entitled to conclude the whole real estate transaction without the assistance of a lawyer. In Norway, estate agents are also in charge of the financial settlement and for registering the deed in a central, state register (not in a notaries register). To run an estate agency in Norway, the estate agent must be insured for at least 10 Million NOK to cover any liabilities the buyer or seller may incur in the course of the transaction.

There are several to choose from. A few reputable agencies are:

• Privat Megleren (www.privatmegleren.no/)
• Ek (www.ek.no)
• Oslo Eiendomsmegling (www.osloeiendom.no)
• DnBNor Eiendom (www.dnbnoreiendom.no/)
• Aktiv Eiendom (www.aktiveiendom.no/Sider/Forside2.aspx)

The commission for an agent will depend on the sale price, with most agencies demanding between 1.5 and 2.5 percent for properties that cost up to 50 Million NOK. As well as this fee, VAT at 24 percent will have to be paid.