Sunday, May 22

Norwegians bought cabins for just over 37 billion in 2021. Cabin sales are still in high gear.

2021 was an all-time high with cabin sales for just over NOK 37 billion. But the lack of carpenters and materials makes it more expensive and delays construction.

The Norwegian cabin center on Hellerudsletta outside Oslo is the Nordic region’s largest permanent cabin exhibition. General manager Olaf Olstad in front of some of the 31 exhibited cabins.

Closed borders and Norwegian holidays have had a favorable effect on several industries. The cabin industry is probably among the luckiest.

29 per cent more new cabins were sold in the period 2020–2021 than in the period 2018–2019, figures from the Forecast Center show.

The strongest increase has been from the summer of 2020 to the summer of 2021. At that time, approximately 7,000 new cabins were sold in Norway, according to the National Association of the Construction Industry (BNL). This corresponds to a doubling from the previous period.

– We see that those with good advice invest in cabins in Norway rather than houses abroad. We have regained part of the market we had lost, says Per Jæger in BNL.

In total, Norwegians bought cabins for 37.4 billion in 2021, according to figures from the Forecast Center. The figure includes both used and new cabins and is up 11 percent from 2020 and up 50 percent from 2019.

And sales do not seem to be declining much, despite the fact that you can travel abroad again. At the end of 2021, 2.5 per cent more cabins had been sold than in 2020, according to the Forecast Center’s figures.

Not just because of the pandemic

The increase is not just due to the pandemic, says partner Bjørn Erik Øye at the Forecast Center. He believes the explanations are also demographic: There have been more Norwegians in the typical age group to buy a cottage, which is less than 50 years old.

– It is the aging wave that strikes. In addition, it is about environmental awareness, that people want to fly less, and the development in housing prices in the cities. People can not afford houses in the cities. Instead, they keep the apartment and buy a cabin, says Øye.

The center’s surveys do not indicate that it is those who have planned to buy a holiday home abroad who have changed their minds and rather bought a cottage in Norway. The number planning to buy abroad is stable at around 100,000 households both before and during the pandemic.

– That group has been sitting on the fence, says Øye.

For that reason, he also does not expect an abrupt drop in the number of cabin purchases once the pandemic is over.

– We believe the speed will slow down somewhat in 2022, and that we have seen the peak. But it takes time before the demographic effect is phased out.

Average price of 3.5 million

They have also noticed the increase on Hellerudsletta outside Oslo. There is the Norwegian Cabin Center, the Nordic region’s largest permanent cabin exhibition. Here, potential buyers can take a look at 31 finished cabins from 21 different suppliers and get an impression of what it will be like to live in them.

The selection includes everything from modern functional cabins in glass and stone to traditional log cabins with grass on the roof.

– We have had good visits during the periods during the pandemic we have been able to keep open. There have probably been 250-300 visits per week, says general manager Olaf Olstad.

He is also general secretary of the Norwegian Cabin Manufacturers’ Association (NOHF). Their members have 65 percent of the Norwegian cottage market and have had a 27 percent increase in sales during the pandemic.

– And it does not seem that it is slowing down now, Olstad says.

Also at the Norwegian cabin center, they have noticed many buyers under the age of 50. They would like cabins of the more modern type.

At the center, there are cabins on display that cost from 2.5 million and up to 9 million kroner. The average price for the cabins sold is approx. 3.5 million, including sole and groundwork.

This is higher than the average price for all sold cabins in the country, which according to Statistics Norway is 2.3 million. This also includes used cabins.

NOK 200,000 more expensive on average

But even though sales have increased sharply, it is not being built at the same rapid pace. Because there has been a shortage of both materials and people to build the cabins. The latter is related to the entry restrictions Norway has had.

Among other things, there have been long delivery times for windows and a lack of semiconductors used in washing machines and dishwashers.

– While before you could jump to another supplier in case of delays, it is no longer possible. All players live a little from hand to mouth when building cabins today, says director Per Jæger in BNL.

The scarcity is evident in the start-up figures, which have far from increased as much as the sales figures. Another plug in the system is the municipalities’ construction case processing.

– Several municipalities do not have the capacity to process all construction cases. We are mapping this, says Jæger.

The effect of all this is that it takes longer to build, and that the new cabins cost more. An ordinary cabin has become 200,000-250,000 kroner more expensive, according to Olaf Olstad in Norwegian cabin manufacturers.

The price increase is also due to a sharp increase in the price of lumber. The cabin manufacturers do not understand this price increase and in August reported the wood products industry to the Norwegian Competition Authority, Olstad says. The Norwegian Competition Authority states that they have processed the complaint, but have not yet found a basis for opening a case.

Director Per Jæger of the National Association of the Construction Industry.

Ask consumers to be critical

Growth in cottage sales is also attracting new players in the market. Jæger in BNL believes it is important that the cottage buyers are critical of which companies they order from.

– If a company is far below others in price, it is a very good indication that you do not follow all the rules. Then the buyer should review the papers carefully and check references, he says.

The industry’s main tool against rogue players is the use of standard contracts, so-called building forms from Standard Norway. In 2020, they also launched the label scheme “Safe cabin purchase” for quality-conscious cabin manufacturers.

– People should be confident that manufacturers who wear this brand follow Norwegian law. We have seen that some parts of the industry do not take care of workers. It creates different competitive conditions and allows us to bring in the mafia and other things we do not want in this market.

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