High household debt and high property prices are vulnerabilities posing a significant risk to financial stability in Norway. Many households have a very high debt burden and limited financial buffers. If the level of interest remains low, there is a risk that vulnerabilities will build up in households and firms in the coming years. Political unrest, trade conflicts and Brexit contribute to great uncertainty about developments in the international economy and financial markets. An international setback or new financial turmoil will affect the Norwegian economy and Norwegian financial markets.

The residential mortgage lending survey 2019 shows a continued increase in the debt-to-income (DTI) and loan-to-value (LTV) ratios of borrowers who take out new instalment loans. Many borrowers have high DTI and LTV ratios, and there was an increase from 2018 to 2019 in the proportion of new instalment loans deviating from the requirements of the residential mortgage lending regulations.