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Home sales in Denmark sink to lowest level since 2013

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Ritzau/The Local - [email protected]
Home sales in Denmark sink to lowest level since 2013
A seagull flies over Copenhagen's Nordhavn district. Photo: Linda Kastrup/Ritzau Scanpix

The number of home sales in Denmark fell over the last three months to the lowest level since the start of 2013, when the country was still emerging from a protracted housing slump.

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Only 9,931 homes were sold in the last three months of 2022, according to the latest figures from the trade body Finance Denmark, the lowest number for 39 three-month periods. At the same time prices have fallen back to the levels they were at at the end of 2020. 

"The second half of the year in particular showed a marked decline in housing transactions," Brian Friis Helmer, economist at Arbejdernes Landsbank. "The headwind comes from higher interest rates, higher energy bills and financial uncertainty." 

Prices of apartments fell by 7.2 percent last three months of the year compared to the same period in 2021, while prices for detached houses fell by 6.3 percent. 

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Bo Sandberg, housing economist at the Confederation of Danish Industry, said that this made Denmark one of the European countries which had seen the biggest falls. 

"We are pretty much only exceeded by Sweden," he wrote in a commentary. "The peak of the price increases, which occurred during an exceptionally favourable and historically unique period in the housing market, has now been shaved off, and prices are back at the 2020 level."

A survey of Danish home owners carried out by Finance Denmark in February 2023 found that a slim majority of 55 per cent expected prices to remain stable over the coming 12 months, with only 20 percent expected prices to drop more than 1 percent. 

This compared to 30 percent who expected a drop of more than 1 percent a year ago. 

Only 2.9 percent of home owners expected a fall of more than 5 percent, while 13 percent expected prices to rise over the next year, with 4.5 percent expecting a rise of more than 5 percent. 

"Energy prices have fallen significantly in recent months, and consumer prices are not rising as quickly as in the past. At the same time, more people have probably got used to the higher level of interest rates," Ane Arnth Jensen, deputy managing director of Finance Denmark, said in a press statement.

"This may be part of the explanation for the fact that the Danes expect the future to be a little brighter, and many expect a calmer housing market in the coming year. But whether that will happen, only time will tell."

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