(Adds finmin, economists, home builders' association)
OSLO, Dec 14 (Reuters) - Norway's government will impose extra restrictions on banks' mortgage lending from 2017, the finance ministry said on Wednesday, to try to address a potential house price bubble, with a particular focus on reining in the Oslo market.
House prices rose roughly 12 percent this year, driving up the consumer debt-to-income ratio and feeding regulators' fears that the economy may suffer longer term.
Among the new rules, borrowing will be capped at less than five times a householder's income and mortages will run over a shorter period of time, the ministry said in a statement.
Banks will have leeway of 10 percent on loan-to-value restrictions, it said, whereas the banking regulator had argued there should be few or no exceptions.
In Oslo, that limit will be 8 percent and anyone buying a second home must have at least 40 percent equity financing, against just 15 percent for those buying primary homes.
Ole Haakon Eek-Nielsen at Nordea Markets said it was difficult to forecast what impact the new rules would have.
"If they manage to limit appetite from (property) speculators it will mean a lot for prices but then again you could assume those buyers have a lot of equity," he said.
As demand has persistently outstripped supply, Norwegian housing prices have been rising sharply for years, particularly in and around Oslo. But opinion differs on the effect of the new rules.
Norwegian Home Builders Association chief executive, Per Jaeger, said the new rules could limit demand for housing in the capital but argued that the solution was for authorities to boost supply by allowing more building.
However, SEB economist Erica Blomgren said a fall in prices would not necessarily be the outcome in any case.
"The difference from current rules are not that big...," she said. "It may help to curb housing prices, especially in Oslo, but nothing indicates that these rules will lead to a decline in housing prices."
The new regulations take effect from Jan. 1 and are expected to be in force until at least mid-2018. (Reporting by Terje Solsvik Editing by Ole Petter Skonnord and Louise Ireland)