2019 has been a good year for the Danish housing market so far, but the same cannot be said about apartment sales. This is especially true for city apartments, where sales have been declining since 2018.
Buyers are not as keen as before. When comparing the first month of 2019 to last year's, we see an overall 18 percent decline in sales of city apartments. January 2018 showed a total of 1524 apartment sales, whilst this year that number was down to 1254.
If you look at the past 12 months and compare trading activity with the previous year, the number of sold apartments have dropped with 19 percent in the country's largest city, Copenhagen. There was a similar 14 percent drop in Aarhus, 7 percent in Odense, and a whole 23 percent drop in Aalborg, the second, third and fourth largest cities in Denmark respectively.
Quiet after market boom
”In both Copenhagen, Aarhus, and Aalborg, we have to go back five years to find a year with fewer apartment deals than now. However, it is rather a question of an unusually high amount of apartments selling in the period 2015 to 2018, than that current trading activity is problematically low. It is important to keep in mind that we are comparing current trading activity to a booming period in the housing market,” says Chief Analyst at Nordea Kredit, Lise Nytoft Bergmann.
Bergmann indicates that it is not the current number of sold apartments that raises concerns for the country's largest cities, but rather a sharp dip in trading activity since spring 2018.
This dip is not without reason. Apartment prices have been on the rise year after year since 2012, with Copenhagen apartment costs increasing with 80 percent. So it is not surprising that buyers are holding off, waiting to see what prices amount to in 2019.
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