Danish house prices reach highest ever level, beating 11-year record

House prices in Denmark have never been higher, with the cost of a buying home now above the previous record set in 2007.

Danish house prices reach highest ever level, beating 11-year record
File photo: Mathias Løvgreen/Ritzau Scanpix

Finance Denmark, an interest organisation for the banking and financial services industries, published the new figures which show house prices to have reached an all-time high.

House prices increased by 4.2 percent nationally in 2018, with the average price of a 140-square-metre-house reaching 1,923,000 kroner (257,000 euros).

The price represents the highest figure for the category since records began in 1992.

“The housing market is doing well, and houses are now being sold for the highest prices ever. Prices are increasing in most of the country and plenty of sales are being completed,” Nordea housing market economist Lise Nytoft Bergmann stated in a written comment.

“We expect this positive trend to continue and house prices to continue to go up in 2019 and 2020,” Bergmann added.

A steep regional variation can be seen in Denmark’s house prices, with the price of a 140-square-metre-house in Copenhagen over 5 million kroner, compared to 1.2 million kroner in western Jutland and 990,000 kroner on the Baltic Sea island of Bornholm.

But although the current prices are at a higher amount than anything previously recorded, actual value is 14 percent lower than in 2007, due to inflation.

The housing market is considered to have been overheated in 2007, the year prior to the global financial crisis. But Bergmann said she did not see the same economic warning signs in the current market.

Lower interest rates mean that mortgages are effectively cheaper than they were 12 years ago.

Additionally, Danes have, on average, better salaries than they did in 2007, improving their chances of being able to finance the purchase of a home.

READ ALSO: Increase in apartments for sale in Copenhagen: report

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Copenhagen nature area to be developed as city approves land sale

A part of the Amager Fælled nature area has lost its reserve status and can now be sold to investors, after a majority in the city's municipal council voted in favour of development on Thursday.

Copenhagen nature area to be developed as city approves land sale
Amager Fælled. File photo: Asger Ladefoged/Ritzau Scanpix

The 219,000 square-kilometre area, known as Lærkesletten, can be sold to developers who wish to build homes on the land, broadcaster TV2 reported.

The sale raises money needed by the city to pay for the new Metro lines, which opened last year, and was part of a political deal agreed in 2017.

City councillors from the Social Democrats, Social Liberals, Liberals, Conservatives, Danish People's Party and two independents voted in favour, while Red-Green Alliance, Alternative and Independent Green parties and one independent opposed.

Located on the southern edge of the natural area on island Amager, the area is frequently used by people from the city for cycling, running and walking.

“We have seen that nature and the environment are at the centre of the public’s perception of what’s important. They want real wild nature in Denmark,” Gorm Anker Gunnarsen, who represents the Red-Green Alliance on the city council, told news agency Ritzau.

An Epinion survey this week showed that 76 percent of people who live in Copenhagen are either partly or completely against development of the area.

Gunnarsen told Ritzau he still believes there is a chance of preserving the nature zone.

“We have the authority to withdraw a building permit in special circumstances,” he said.

An advisory public vote could on the matter provide the basis for this, he argued.

“This case will not then just rest on which party you are with, but also on your view of the individual case,” he said.

READ ALSO: Copenhagen natural area Amager Fælled gets new development plan