Moderate increase in rent

The housing and maintenance expenses group rose 0.7 per cent from August to September. Prices of goods and services for maintaining homes rose faster than rent.

Rent increased 0.2 per cent in the third quarter this year. At the same time last year rent had increased 0.5 per cent. The rent for dwellings in housing cooperatives increased more than the rent for rental housing. Rent is measured in a separate survey and fresh figures are included in the consumer price index for March, June, September and December.

In the consumer price index, rent changes represent the price trend for household consumption of housing. Rent is influenced by interest levels, municipal fees, janitor expenses, insurance and other factors. Around 60 per cent of the sample in the rent survey consists of households who own their accommodation through a housing cooperative, and the effect of an increase in the interest rate will depend on how quickly the housing cooperative decides to raise the rent. The degree to which the housing cooperative pays fixed interest rates is another factor that can impact rent. Experience has shown that it takes time before interest rate changes show up in the consumer price index. The effect of the sharp decline in interests rates in 1993 did not become visible in the index until 1994, when the annual increase in rent fell by 0.6 per cent.

The prices of goods and services for maintaining dwellings increased 1.7 per cent from August to September. Maintenance expenses have also risen faster than rent over the past five years. While rent increased around nine per cent from September 1993 to September 1998, the expense of maintaining a home rose by about 20 per cent during the same period. The primary factor at work here was the sharp increase in the cost of services during this period.

New Statistics
Consumer price index, 15 August 1998.
The statistics are published monthly in the Weekly Bulletin of Statistics. For more information, contact: Kari-Anne.Hovland@ssb.no, tel. +47 21 09 47 22, or Randi.Johannessen@ssb.no, tel. +47 21 09 47 30.

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Weekly Bulletin issue no. 42, 1998