Why is a large part of the housing market in Denmark rent-controlled?

In Denmark, the rental market is rent-controlled to ensure a fair cost of living for everyone. A rent-controlled is created to make sure the people who rent housing doesn’t spend the major part of their disposable income on housing.

In a market without rent-controlled housing, the cost of purchasing real-estate goes up and the social mobility goes down. That’s why we believe it is important to enforce the regulations.

Which building are rent-controlled?

As a rule of thumb, all buildings built before 1992 are rent-controlled. There are some exceptions such as if the building was previously used for commercial real estate and has been converted to housing. Or if you’re renting a ‘loft apartment’ where the apartment was previously used for storage and has been converted – this has to be written in your contract.

If you want to check what year your building is from, enter your address on this site and look at the year after it says ‘opført’.

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Expense based pricing

Expense-based pricing is one of the two ways the rent is calculated. This method lets a landlord gather all the costs they have of operating and maintaining the building and add roughly 7% interest on the costs of the investment. Typically this would let a landlord charge about 6700-7500kr for a 100 square meter apartment in Copenhagen.

 

As a tenant, you’re, in most cases, eligible for a back-payment for up to 36 months since you moved in if this pricing methodology applies and you’re being overcharged.

``What is it worth``- pricing

This pricing methodology is known as ‘lejedes værdi’ in Danish – also commonly referred to as §5 stk.2. This method is less objective than the ‘expense-based pricing’ method, as it’s subjectively set by the judges in the rent control boards. A certain set of criteria has to be met to use this pricing methodology, the most typical being a large investment in the property over a 2-year period.

 

Typically you’re allowed to charge around 5.500-6500kr pr. 50sqm. per month.

 

As a tenant, you’re eligible for a back-payment of excess rent as long as you file a case within 12 months of you moving in or within 12 months of the latest rent-increase. In most cases, your rent is regulated once a year in accordance with inflation.

Smaller buildings and other exceptions

If your building consists of less than 7 apartments, then the pricing methodology known as 29c applies. This pricing methodology is a subjective pricing methodology, where your apartment gets compared to what it would cost if the building was priced using ‘expense based pricing’.

 

This rule also applies to apartments in buildings with more than 6 apartments, if the owner of the apartment in 1995 owned less than 7 apartments. Meaning, if your building was owned by a professional landlord in 1995 this probably doesn’t apply, but if a private individual owned it, then it’s most likely priced using 29c.

 

Typically the monthly price pr. 50sqm is around 3500-5000kr.

Calculate your legal rent
What about rooms?

Rooms are also rent-controlled. They are harder to estimate the legal price for compared to full apartments, as the pricing of these is set subjectively.

 

Typically the legal rent-level for a room is around 2500kr to 4000kr a month.

Furniture rental

When renting an apartment, furniture rental should be included in the rent. Many landlords try to circumvent rent-control by setting adding a large monthly price for renting the furniture. Statistically, a furnished apartment allows for a 3-4% extra in monthly rent so it does have a small impact on the rent-level.

 

If you’ve been charged for the rental of furniture you can reclaim the paid amount in full going back a maximum of 3 years.

Calculate your legal rent
Want our help?

If you want to find out if you’re overpaying for rent-controlled housing you can use our calculator. It’s based on 200+ verdicts.

Calculate your legal rent

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