Danish government refuses to intervene over soaring house prices
The government has decided against following advice from a guidance board suggesting it intervene in the country’s housing market.
The Systemic Risk Council (Det Systemiske Risikoråd) advised the government in June this year to act against consistently increasing house prices, specifically by limiting a grace period for instalments on mortgages given to people with high levels of debt.
The council is a government advisory panel which, according to its website, “seeks to prevent and reduce systemic financial risks that may put the economic development under stress.”
On Tuesday, the Ministry of Industry, Business and Financial Affairs confirmed in a statement that it would not follow that advice.
The decision was based on signs that the market is beginning to cool, business minister Simon Kollerup said in the statement.
Explained: Why is Denmark starting to apply the brakes to its economy?
“There are good signs and therefore no reason to intervene here and now while we are also seeing that the Danish economy is healthy,” Kollerup said.
“Household economies are robust and the banks are stable,” he added.
Although no intervention will be made at the current time, a close eye will be kept in the housing market according to the minister.
“I believe it is due caution as we now hopefully move from corona times to more normal times – including on the housing market,” he said.
TELL US: Share your ups and downs of buying property in Denmark
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The Systemic Risk Council (Det Systemiske Risikoråd) advised the government in June this year to act against consistently increasing house prices, specifically by limiting a grace period for instalments on mortgages given to people with high levels of debt.
The council is a government advisory panel which, according to its website, “seeks to prevent and reduce systemic financial risks that may put the economic development under stress.”
On Tuesday, the Ministry of Industry, Business and Financial Affairs confirmed in a statement that it would not follow that advice.
The decision was based on signs that the market is beginning to cool, business minister Simon Kollerup said in the statement.
Explained: Why is Denmark starting to apply the brakes to its economy?
“There are good signs and therefore no reason to intervene here and now while we are also seeing that the Danish economy is healthy,” Kollerup said.
“Household economies are robust and the banks are stable,” he added.
Although no intervention will be made at the current time, a close eye will be kept in the housing market according to the minister.
“I believe it is due caution as we now hopefully move from corona times to more normal times – including on the housing market,” he said.
TELL US: Share your ups and downs of buying property in Denmark
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