Frontpage News 2013 Housing prices’ up...

Housing prices’ ups and downs

18 September 2013

New figures from the Housing Market Statistics show a general improvement in prices in the housing market. But there are still considerable variations in terms of location and type of housing. See how prices have risen here. 
 
Particularly for owner occupied dwellings, there are major differences in the development of prices per square meter. From Q2 2012 to Q2 2013, the price of owner occupied dwellings rose in 6 of 11 regions, while prices have fallen in the remaining regions, cf. figure 1.

"It was expected that prices would generally rise in Q2, as it is that time of year where prices traditionally rise the most. Compared to the same period last year, there are still considerable geographical differences in prices," says Niels Storm Stenbæk, Chief Economist at the Danish Bankers Association.

The largest percentage increases are in Copenhagen city and region, where the prices for owner occupied dwellings increased between 8.3 -15.3 percent compared to the previous year. But there has also been a major increase in prices in Jutland and on Funen.
 
On Bornholm and in West and South Zealand, the situation is reverse, where prices have fallen sharply since last year. Just from Q2 2012 to Q2 2013, prices fell by more than 10 percent in these parts of the country. 
 
 
Figure 1: Evolution of the square meter price for owner occupied dwellings
Source: The Danish Bankers Association’s calculations based on the Housing Market Statistics.
Note: The percentage change from Q22012 – Q2 2013. The numbers are aggregated at the regional level, and prices can vary within the different parts of the country.
 
 

Detached- and terraced houses are still behind

Looking at the trends in the market for detached houses, the map also shows large variations. In general, house prices have a hard time getting up to speed. The geographic trend shows that sales prices of detached houses have fallen in 8 of 11 regions, cf. figure 2.
 
Only in Copenhagen city and region, and in East Zealand, have selling prices increased over the last year. From Q2 2012 to Q2 2013, prices in these areas have increased by 3.2-6.3 percent.
 
In Q2, homeowners in West and South Zealand saw a price reduction of almost 7 percent compared to the same quarter last year. Funen and Jutland were "only" hit by a price drop of more than 2 percent.
 
"The market for detached- and terraced houses fill the vast majority of the Danish housing market, and here we see that is still a very, very sluggish price performance when compared to last year," says Niels Storm Stenbæk.
 
 
Figure 2. The development of the square meter price for detached- and terraced houses
Source: The Danish Bankers Association’s calculations based on the Housing Market Statistics
Note: The percentage change from Q2 2012 – Q2 2013. The figures are aggregated at the regional level, and prices can vary within the different parts of the country.

 

 
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