Danish homebuyers face fewer options as housing supply drops nationwide. The number of available properties fell during October across all categories.
Home listings decreased 2.3 percent nationally, while apartments for sale dropped 4.7 percent. The decline affects summer houses, villas, and condominiums equally.
Jeppe Juul Borre, chief economist at Arbejdernes Landsbank, explains the trend. "High transaction volumes are pushing supply down," he said in a statement. "This could lead to higher housing prices."
September recorded the highest number of property transactions in 50 months when adjusted for seasonal variations. The strong Danish economy drives this buyer enthusiasm.
"We have record-high employment, relatively low unemployment, and many Danes experienced increased purchasing power from solid wage growth," Borre noted. "This stimulates demand for home purchases and pushes transaction numbers up."
Condominiums show the most dramatic supply reduction. Nationwide, available condominiums dropped 21.7 percent compared to last October.
Copenhagen saw the steepest decline at 31.5 percent fewer apartments for sale. Region Sjælland followed with a 27.4 percent reduction. Only Region Nordjylland maintained last year's supply levels.
Falling supply creates upward pressure on prices. "When real estate agents have fewer properties on their shelves, it can lift prices further," Borre explained. "We expect prices to continue rising from here."
Increasing housing prices might eventually attract more sellers to the market. "Rising prices seen across most of the country could convince hesitant homeowners to list their properties," Borre added.
The Danish housing market shows classic supply-demand tension - strong economic fundamentals drive buyer demand while sellers remain cautious, creating a perfect storm for price increases that could eventually balance the market when more homeowners decide to capitalize on rising values.