Denmark’s property market is not known as being easy to get onto, but the doors have opened a little over the last year due to falling interest rates and rising wages, credit institution Realkredit Danmark has found in an analysis.

The analysis uses calculations of the incomes needed by households applying for mortgages to buy houses in each of Denmark’s 98 municipalities.

In all but 7 of the municipalities, the conclusion was that it has become easier to be approved for a mortgage for those families.

Wages have increased in Denmark by an average of 5 percent in the last year, which is more than the amount by which the income criteria set by banks has gone up.

Although it has become easier to be approved for a mortgage, the loans themselves are more expensive than they were three years ago when interest rates of 1 percent were available on mortgages and house prices were lower.

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The income requirement for mortgages has gone up by more than wages in 96 municipalities since 2021, painting the opposite picture to the trend over the last 12 months.

“We surprisingly see the same situation reflected in the so-called ‘housing burden’ – meaning what it costs to buy and own a house in relation to disposable incomes – which is at a higher level today than it was in summer 2021,” senior economist with Realkredit Danmark, Christian Hilligsøe Heinig, said in a written comment to news wire Ritzau.

The criteria for household income is highest in the Copenhagen area, where house prices are higher.

For example, upmarket district Frederiksberg needs a household income of 2.36 million kroner per year for approval on a mortgage for a home of 140 square metres in size.

In second city Aarhus, the equivalent requirement is 940,000 kroner, while rural municipality Vesthimmerland has it at 690,000 kroner.