Price is important in every purchase decision and even more so when you are dealing with real estate sold at 7-digit prices (and sometimes even more). Many elements determine the house prices in Denmark; however, we have narrowed them down to five critical factors. Note that these five factors don’t uniquely affect Copenhagen house prices but real estate prices in Denmark in general.
1. The location is crucial to the house prices in Denmark
Location, location, location. One of the most, if not the most important price determinator when looking at the house prices in Denmark. Real estate prices are usually higher in urban than rural areas. Roughly speaking, the further you are away from Copenhagen, the lower the real estate prices – except in larger cities like Aarhus, Odense and Aalborg.
Houses in cities surrounding Copenhagen i.e. Roskilde, Køge, Hillerød etc., are relatively high-priced, but that is to expect when you are this close to the capital. The prices, however, are still lower than actual Copenhagen housing prices. For a description of the different districts of Copenhagen and more information about Copenhagen real estate prices, read our previous article about what to consider when wanting to buy a house in Copenhagen.
When looking at housing in Denmark, the state of the property has, of course, something to say in the pricing. A rundown, old house cannot be sold for the same price as a recently built house in the same area. You can look at it as a trade-off: Pay less for the property here and now and spend many resources modernising it or pay more for the property here and now and spend minimal resources on modernisation.
For the everyday person, the middle ground is usually the way to go as to not get more than what you bargained for, while at the same time balancing your current finances with future returns and risks.
At Bomae, our buyer’s agents are always ready to guide you so you make the best decisions based on your current situation. We can also help you find houses for sale in Denmark and select the ones that fit our needs the best.
3. The property’s layout
In continuation of the previous point, the layout of a property also determines its value. Imagine a house with two floors and only one bathroom in the basement. Now, imagine a house with two floors and bathrooms on each level. Which house sounds more attractive to you?
A practical and well-planned layout will always be more desirable and, thus, contribute to the property’s overall value - and the price you must pay for it.
4. The floor level
Lower level units are typically less expensive than higher level units. The reason for this is that penthouse units are more prestigious and come with a better view, making them more coveted among buyers. Though a ground floor condominium can be just as accommodating as its penthouse counterpart, the reality is that the latter is just more attractive which, in turn, affects the real estate price.
Yes, even Mother Nature’s forces affect the property price. You would want your new home to have a good amount of natural lighting, but not so much that you are blinded by it while doing everyday things. And on the contrary, a home with minimal natural lighting can quickly become dark and depressing - there is only so much artificial lighting can do.
Always take the sun’s path into consideration when looking to buy property. When going to an open house, make it a priority to investigate how the natural light falls. The lack or overexposure of light can then be used as a bargaining chip in the buying process.
But are you even eligible to buy a house in Denmark?
Keep in mind that looking at the house price is one thing and another to pay it. Though real estate is considered by many to be a safe option for upcoming investors, there is still the fact that you have to put yourself into debt to finalise the purchase.
This is also why banks measure your debt-to-income (DTI) ratio before offering you a mortgage or loan.
The DTI ratio measures your ability to pay back money: a low DTI means there is a good balance between a person’s debt and income. Contrarywise, a high DTI indicates that a person has too much debt compared to their earned income.
Many forget that banks are businesses and only lend you money because they can profit from it. With the help of a buyer’s agentlike Bomae, you can avoid unfavourable and expensive loans/mortgages, because we help you negotiate with the bank and find different financing offers.
Remember the extra expenses when buying a house in Denmark
Even if everything goes according to plan and the bank offers you a mortgage/loan, and the real estate agent has agreed to your offer, there are still more fees to pay.
A lawyer is essential when buying real estate; as you can guess, their help does not come for free. Another thing you must set aside money for is the fee for registration in the Danish Land Register. Both prices are usually included in the mortgage/loan, meaning you do not directly pay, e.g., the lawyer's fee to the lawyer themselves. Instead, you get a bigger mortgage/loan to cover the costs.
And then there are all kinds of establishment costs, some of which are fair, while others give you the feeling of throwing money out the window. However, you can avoid the last part if you invest in a buyer’s agent like Bomae to stand by your side. We provide homebuyers with price reductions up to 14% and negotiate with banks to ensure our customers get the best possible mortgages and loans for their budgets.
Thank you for reading; we hope you found the article inspiring and valuable.
How much does a house cost in Denmark? The price for a house in Denmark depends very much on the location of the house. If the home is located in one of the big cities like Copenhagen, Aarhus or Odense, you can expect that it is pretty expensive. Conversely, if you want to buy a house in a remote area, the price will be less expensive. Another essential factor on the price is, of course the state of the house:
A house in good repair costs more than a decrepit house in the same area.
Can a foreigner buy a house in Denmark? Yes, a foreigner can buy a house in Denmark. However, if you have not lived here for five years or do not have a permanent residence in Denmark, you must apply for permission from the Department of Civil Affairs.