Danish Government Proposes Easier Mortgages for First-Time Buyers
Denmark’s government aims to simplify access to mortgages for first-time home buyers, responding to the rising costs of housing. Culture Minister Jakob Engel-Schmidt highlighted the challenges faced by young people trying to enter the property market.
“In recent years, we’ve seen that a great many first-time buyers have been unable to get onto the housing ladder. The number of first-time buyers has fallen by almost 25 percent, and many young people are left pressing their noses against the window, unable to get in,” said Engel-Schmidt.
The government plans to introduce longer mortgage repayment terms and increased borrowing limits to help buyers. Currently, mortgages cover 80% of the property value with a repayment period of 30 years. The rest is financed by a bank loan and a minimum 5% downpayment from the buyer.
Proposed Mortgage Changes
- Extend the mortgage repayment period from 30 to 40 years
- Allow mortgages of up to 80% of the property's value
The extension of the repayment term is expected to reduce monthly mortgage payments by about 560 kroner per borrowed million, making home ownership more accessible.
“We need to do something about that, because we know that owning your own home is generally both financially sound and attractive. The government and I want more Danes to own their homes,” Engel-Schmidt added.
Mortgage Funding Breakdown
- 80% mortgage on property value
- Remaining amount via bank loan (banklån or boliglån)
- Buyer's cash downpayment (egenbetaling) must be at least 5%
These measures reflect the government’s commitment to supporting young Danes in achieving home ownership amid financial challenges.
Author's Summary
The Danish government proposes to ease first-time buyers’ mortgage conditions by extending the repayment period and maintaining borrowing limits, aiming to make home ownership more affordable.