Around 5 per cent of one-family houses in Denmark are sold each year, so that for most homeowners a small price drop will just mean that a small part of the capital gain that emerged so quickly will disappear. The increase in interest rates moreover diminishes the market value of the outstanding debt, unless the home is financed at variable interest rates.
Danmarks Nationalbank assesses that in the short term the slowdown in the housing market will have only a limited effect on the economy in general. Once the construction backlog has been eliminated, new construction and conversion activity will probably dampen, but that is still far off, and furthermore, business construction is increasing.