Considerations When Buying A House

Buying a house or apartment in Copenhagen

It is similar to purchasing property elsewhere in Denmark - read more about the process here. However, you should be aware of a few things unique to the Copenhagen real estate scene before committing yourself further.

In this article you can read about:

What Should I Think About
Different regulations and policies
Where should I buy a flat in Copenhagen
Mortgage Refinancing and Variable interest on a house mortgage

I want to buy an apartment in Copenhagen – what should I think about?

Before diving into the process, it's important to consider a few key factors. The Copenhagen real estate market has experienced significant price increases in recent years, prompting buyers to explore options both within and outside the city.

Rising real estate prices: Copenhagen's real estate market has witnessed substantial price hikes, which may impact your budget and investment decisions. Researching and analysing the current market trends and property prices is crucial to make an informed decision.
Exploring the outskirts: Due to soaring prices within the city, many homebuyers are turning their attention to the outer edge of Copenhagen. Suburbs like Rødovre, Hvidovre, and Brønshøj can acquire larger square footage at more reasonable prices while still within a few kilometres of the city centre.
Nearby cities as alternatives: Beyond the immediate outskirts of Copenhagen, neighbouring cities such as Køge, Hillerød, and Roskilde present attractive options. These locations offer good value for money in terms of real estate and benefit from well-planned infrastructure, ensuring a close distance to Copenhagen. Additionally, these towns are experiencing growth, making them even more appealing for investment.

Buyer's Agent

Different municipalities equal different regulations and policies

Different municipalities have varying regulations and policies. This holds true for Copenhagen City and the municipalities within the Capital Region. Factors such as elder and childcare policies and taxes can differ based on your chosen municipality. For instance, while the Municipality of Copenhagen and the Municipality of Frederiksberg share similarities, the tax rate in Frederiksberg is lower. Therefore, when buying a home in Copenhagen, it's essential to consider more than just the postal code and property price.

Buying a house gives you better insurance opportunities

Have you thought about buying a house or apartment in Copenhagen? Because there is more to this decision than first meets the eye.

The thing is that when you buy a house in Denmark, you are eligible for a change of ownership insurance. A change of ownership insurance is a type of property insurance that covers property defects not mentioned in the home condition report. The change of ownership insurance is convenient for buyers and sellers as well, as it waives the latter's obligation to compensate the buyer for any unforeseen property defects.

Learn more about buying an apartment in Denmark here.

Buyer's Agent

Where should I buy a flat in Copenhagen?

Now that you have been introduced to key important factors about buying property in Copenhagen let us look at the many neighbourhoods you can settle in. Please read more below for an overview of the different districts and what they offer.

Vesterbro

Vesterbro is very close to the city centre and can be reached within 5 minutes by bike. Its reputation as a hip and trendy neighbourhood with a laidback atmosphere has made it a trendy residential area. Vesterbro was formerly known as Copenhagen's red-light district but is now one of the most attractive districts to live in – and this shows in the real estate prices.

Østerbro

Østerbro is known for its green areas and housing the largest public park in Denmark, Fælledparken. Østerbro is located north of the city centre by the waterfront and within walking distance from the inner city. It is an attractive neighbourhood that is home to people and businesses. Østerbro is especially popular among families with children.

Nørrebro

Known for being a multicultural area, Nørrebro is located just north of the inner city. Nørrebro has become a hip district popular enough to rival Vesterbro in trendiness. In addition to being a residential area, Nørrebro also offers plenty of restaurants, cafes, bars etc.

Amager

Amager is one of the newer neighbourhoods, as more and more people have recently discovered the island's pleasant mix of nature and urban living. Amager is located on the south side of Copenhagen, and many of the urban areas are integrated into Copenhagen, essentially making Amager an extension of the capital city. Amager offers both new and old apartments at varying prices.

Nordhavn

One of the newer residential districts in Copenhagen. Formerly an industrial zone, Nordhavn is now a residential area with many waterfront buildings looking towards Øresund.

Sydhavn

A neighbourhood that offers both beautiful buildings and nature. Sydhavn is the perfect place to live if you want to distance yourself from the busy streets of inner Copenhagen but still wish to be close to the city.

Carlsbergbyen

An upcoming district, Carlsbergbyen, is a small neighbourhood located within Vesterbro. The area is named after the Carlsberg Brewery, which had its base for approximately 150 years. Carlsbergbyen offers modern buildings and buzzing business life.

Buying property in Copenhagen is roughly the same as elsewhere in this country. Nevertheless, the little details make a big difference and failing to recognise them can impact the quality of your life in the short and long run. That is why Bomae exists – we are here to help.

Mortgage Refinancing Made Simple

Mortgage refinancing allows homeowners to optimise their loan terms and potentially save money. Whether reorganising a fixed loan to a lower interest rate (down conversion) or switching to a higher interest rate but with a lower outstanding debt (up-conversion), refinancing can have advantages and considerations. To navigate this financial decision wisely, seeking expert advice tailored to your situation is crucial. In addition, if you're looking to transfer funds internationally, consider using Wise for cost-effective and efficient money transfers.

Down Conversion: Refinancing a loan to a lower interest rate while keeping the outstanding debt unchanged or higher.
Up-Conversion: Refinancing a loan to a higher interest rate, often resulting in lower outstanding debt.
In both scenarios, professional financial advice is invaluable to make informed decisions in a changing market.

Variable interest on a house mortgage

Variable interest on a house mortgage offers flexibility but requires careful consideration. These loans, such as F1-F5 loans, have interest rates known for short periods, typically 1-5 years. Unlike fixed-rate loans, variable-interest loans are always taken at a price of 100, resulting in a lower total loan amount and avoiding exchange losses. However, repayment terms for variable-interest loans require attention.

With variable interest loans, repayment can be made at the time of mortgage rate adjustment, typically at a price of 100. For example, with an F5 loan, repayment at a price of 100 is possible only after 5 years. If you need to repay the loan before the deadline, it will usually be at the market price, often below 100, resulting in additional costs compared to the owed amount.

Although variable interest rates are generally lower than fixed rates, loans with variable interest often have higher contribution rates, reducing some of the savings from the lower interest rate. Nevertheless, variable interest loans tend to have a lower current price compared to fixed-rate loans.

Things to Consider When Wanting to Buy a House in Copenhagen, Denmark