During the Danish

property bubble A real-estate bubble or property bubble (or housing bubble for residential markets) is a type of economic bubble that occurs periodically in local or global real-estate markets, and typically follow a land boom. A land boom is the rapid increa ...

of 2001 through 2006,

Danish Danish may refer to: * Something of, from, or related to the country of Denmark People * A national or citizen of Denmark, also called a "Dane," see Demographics of Denmark * Culture of Denmark * Danish people or Danes, people with a Danish a ...

property prices rose faster than at any point in history, in some years increasing by more than 25%.

Apartments An apartment (American English), or flat (British English, Indian English, South African English), is a self-contained housing unit (a type of residential real estate) that occupies part of a building, generally on a single story. There are man ...

and homes near the big cities rose especially fast. Some of the rise can be attributed to falling

interest In finance and economics, interest is payment from a borrower or deposit-taking financial institution to a lender or depositor of an amount above repayment of the principal sum (that is, the amount borrowed), at a particular rate. It is distinct ...

rates, the introduction of new

loan In finance, a loan is the lending of money by one or more individuals, organizations, or other entities to other individuals, organizations, etc. The recipient (i.e., the borrower) incurs a debt and is usually liable to pay interest on that d ...

types (such as interest-only

mortgage A mortgage loan or simply mortgage (), in civil law jurisdicions known also as a hypothec loan, is a loan used either by purchasers of real property to raise funds to buy real estate, or by existing property owners to raise funds for any pu ...

s), improving economy and increasing

urbanisation Urbanization (or urbanisation) refers to the population shift from rural to urban areas, the corresponding decrease in the proportion of people living in rural areas, and the ways in which societies adapt to this change. It is predominantly the ...

, higher wages along with other factors. Some observers have also noted increased interest in homes and a dramatic increase in the number of TV programs regarding home decoration, home sales,

gardening Gardening is the practice of growing and cultivating plants as part of horticulture. In gardens, ornamental plants are often grown for their flowers, foliage, or overall appearance; useful plants, such as root vegetables, leaf vegetables, fruits ...

etc. The increasing number of parents buying apartments for their children is also an important factor, dramatically increasing the demand on smaller apartments, typically 2 - 3 rooms, thus giving rising prices from the lower segment of apartments. However, many banks and analysts acknowledge that prices have increased more than can be explained by their models even when taking the economic factors into account and that homes have indeed become less affordable. In particular, it is becoming increasingly difficult for

first-time buyer A first-time buyer (FTB) is a term used in the British, Irish, Canada property markets, and in other countries, for a potential house buyer who has not previously owned a property. A first-time buyer is usually desirable to a seller as they do no ...

s to enter the market, and they now make up a historically low fraction of all buyers. This has led some observers to speculate that the Danish

real estate Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, (more general ...

market may be in a bubble where price increases have been fueled by speculation beyond what can be justified by fundamental economics. Some have warned that the market may be in for a correction, i.e., major price decreases. Still, as of March 2007, this has not occurred.

Copenhagen Copenhagen ( or .; da, København ) is the capital and most populous city of Denmark, with a proper population of around 815.000 in the last quarter of 2022; and some 1.370,000 in the urban area; and the wider Copenhagen metropolitan ar ...

have fallen 7% in the first quarter of 2007 and the supply is still rising. However, there are signs that the market is softening and prices have fallen in some areas. In 2006, the number of homes for sale increased dramatically, tripling in some areas. It was estimated that 10% of all apartments in Copenhagen are for sale. The total inventory of homes for sale totaled more than one average year of home sales. In the statistics for the fourth quarter 2006, some areas experienced a quarter-to-quarter price fall around 4-5%, the first significant fall in over a decade. Two of the major real estate agencies claim they are observing price falls, with the biggest agency (Home) claiming to have observed falls since July 2006 The softening comes at a time when there has been an explosion in the building of new apartments and homes all around in the country. In Copenhagen alone, as many as 2,000 new apartments are expected to be added to the inventory during 2007. *

Denmark ) , song = ( en, "King Christian stood by the lofty mast") , song_type = National and royal anthem , image_map = EU-Denmark.svg , map_caption = , subdivision_type = Sovereign state , subdivision_name = Danish Realm, Kingdom of Denmark ...

2007 - -12% Recent history of the Danish residential property market, Global Property Guide
/ref>

References

External links

Core Economics
animated Real Estate Rollercoaster Ride {{DEFAULTSORT:Danish Property Bubble Of 2000s Economic history of Denmark Economy of Denmark Real estate bubbles of the 2000s