Danish Government Plans Easier Mortgages for First-Time Buyers
The Danish government aims to simplify access to mortgages for first-time home buyers amid rising housing costs. Culture Minister Jakob Engel-Schmidt emphasized the importance of making homeownership more accessible to young people across the country.
“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 Jakob Engel-Schmidt.
“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,” he added.
Proposed Policy Changes
- Extending the maximum mortgage repayment period from 30 to 40 years.
- Maintaining the 80 percent loan-to-value ratio on the property.
- Keeping the required down payment at a minimum of 5 percent of the home’s price.
According to government estimates, extending the repayment period could reduce monthly loan payments by approximately 560 kroner per borrowed million, equal to around 6,700 kroner saved annually.
Funding Structure
The rest of the home purchase is typically financed through a combination of a bank loan (banklån or boliglån) and the buyer’s own down payment (egenbetaling). These elements work together to cover the property’s remaining value beyond the 80 percent mortgage portion.
Author’s summary: Denmark plans to ease mortgage terms for first-time buyers by extending repayment periods and offering moderate monthly savings, aiming to boost homeownership among younger citizens.