Danish property terms explained

A

Andelsbolig (co-operative home). You do not buy the home itself. You buy a share in a co-operative that owns the building, with the right to live in one of its homes (andelsbevis). You share the co-operative’s loans with the other members and pay a monthly housing charge (boligafgift). Read the bylaws and the accounts before you sign.

B

Bankforbehold (bank reservation). A clause in the purchase agreement that keeps you from being bound until your bank has approved the financing. It is not required, but it protects you if the bank says no. If your buyer’s advisor has already made the deal subject to his approval, you do not need one.

Bankgaranti (bank guarantee). About 6-8 days after the purchase agreement is signed, you transfer part of the price to the seller’s estate agent, and your bank guarantees the rest. The money goes into a blocked account. The seller gets it only when the sale is final and you have received the deed (skøde).

Banklån (bank loan). Most homes are financed with a mortgage (realkreditlån) of up to 80% of the price, plus a bank loan for the rest. The bank loan is usually a little more expensive than the mortgage. The bank registers security in the property.

BBR-ejermeddelelse (BBR owner notice). A document with the facts registered about the home in the Building and Dwelling Register (BBR): year built, size, location and technical details such as an oil tank or geothermal heating. The owner is responsible for the facts being correct, so compare them with what has actually been built. A small shed missing from the register is common. Unlawful changes to the living area are more serious and can be costly for you.

Berigtigelse (completion). The final step of the sale. The seller has received the money, your deed is registered, and you have legal title (adkomst) to the property.

Boligkøbsbevis (home purchase certificate). After reviewing your finances, your bank issues a certificate that shows what you can afford to buy. Ask for it before you start looking for a home.

Byzone og landzone (urban zone and rural zone). Denmark is divided into three zones: urban zone (byzone), summer house areas (sommerhusområder) and rural zone (landzone). In an urban zone the building regulations apply to new building, and a local plan may limit how you use the property. The rural zone has somewhat freer rules, but there can still be restrictions. Ask the municipality before you plan to build or extend.

D

Dispositionsdag (possession date). Sometimes agreed before the takeover date. You get the keys and can move in before the legal takeover. From the possession date you pay for consumption and house insurance. You pay the price only on the takeover date, so in practice you have little or no rent in between. The seller pays the ownership costs until the takeover date.

E

Ejendomsdatarapport (property data report). One of the documents in every property sale. It holds about 50 facts about the property, for example whether the plot is polluted, whether there are oil tanks, whether a local plan applies, what heating and water supply there is, and whether property tax is overdue. Your buyer’s advisor compares it with the other documents.

Ejendomsværdiskat (property value tax). A yearly state tax on a home you use yourself, based on the public property valuation. It is collected automatically through your Danish tax return.

Ejerforening (owners’ association). When a building is divided into owner-occupied flats, every owner must belong to the owners’ association. It runs and maintains the shared parts of the building. You pay your share through the common charges (fællesudgifter) and vote at the general meeting. The bylaws set the rules between owners, for example whether you may rent out the flat or keep pets. When you buy, you normally give the association security for your share of the charges, which can add costs to the purchase.

Ejerlejlighed (owner-occupied flat). A flat that is its own property, usually part of a larger building. You own the flat itself. The plot, stairs and other shared parts are owned together with the other owners through the owners’ association. The association may keep a reserve fund (grundfond) for large shared costs.

Ejerskifteforsikring (ownership transfer insurance). Insurance against hidden defects, and part of the house inspection scheme. You get an offer with the sale documents and may buy it from any insurer. The seller pays half of the premium of the offered policy. It covers hidden damage that is not in the condition report or the electrical report and that you were not told about. Buy it soon after the deal is final. You pay the premium in the weeks before the takeover date.

Ejerudgifter (ownership costs). The costs of owning the property, shown per year and per month in the sales particulars: property taxes, house insurance, waste collection, pest control, and fees to a homeowners’ association or owners’ association. The estate agent must state them correctly, so that you and your bank can rely on them.

Elinstallationsrapport (electrical installation report). Made by an authorised electrician and valid for 12 months. It grades the faults found. Read it closely for illegal installations that you would take over. Making them lawful can be expensive, so it is often a point in the price negotiation.

Energimærke (energy label). The seller must provide a valid label, and it is valid for 10 years. It shows the energy use of the building and which improvements pay off. The heating cost in the sales particulars is calculated from a standard, so your own use may differ. Keep the label if you plan to renovate.

F

Fordelingstal (distribution key). It decides each owner’s share of the common costs in an owners’ association. It is usually based on the size of the flat compared with the total area of the building, and sometimes everyone pays an equal share. You find it in the land register (tingbog) or in the bylaws.

Forbehold (reservation). A condition that keeps the deal from being final until it is met. The most common are the buyer’s advisor’s approval and the approval of the buyer’s bank. It matters whether the reservation is in the purchase agreement before you sign, or is added afterwards in the advisor’s approval letter. A reservation added afterwards changes the agreement and counts as a new offer, so the seller can withdraw. A clarification of the existing agreement does not give the seller that right.

Fortrydelsesret ved boligkøb (right of withdrawal). You have 6 working days after the purchase agreement is signed by both sides. The period starts the day after you are told that the seller has signed. Saturdays, Sundays, public holidays and Constitution Day do not count. Withdrawing costs 1% of the price, and the money must reach the seller or the estate agent before the deadline. If your buyer’s advisor has not yet approved the deal, he can decline to approve it on your behalf, which is a free way out.

Fællesudgifter (common charges). The costs of running the shared parts of a building: maintenance, repairs, waste collection, insurance and administration. Owners of flats pay them to the owners’ association.

G

Grundejerforening (homeowners’ association). An association for the owners of plots in an area or on a road. It usually looks after roads, green areas and playgrounds. In some associations membership is compulsory, and then it is stated in an easement or a local plan. You must follow its rules and bylaws, even if you find them unreasonable.

Grundskyld (land tax). Paid to the municipality and based on the public land value. It is collected through your tax assessment. You find the yearly amount in the ownership costs in the sales particulars.

H

Huseftersynsordningen / HE-ordningen (house inspection scheme). For houses, summer houses, owner-occupied flats and former farms under 2 hectares, the seller can use this scheme. The seller then has a condition report and an electrical report prepared, offers you ownership transfer insurance and pays half of the premium. In return the seller is released from liability for hidden defects. It is your choice whether to buy the insurance, and in most cases it is a good idea.

J

Jordforureningsattest (soil contamination certificate). It shows whether the plot is registered as contaminated. Knowledge level 1 (V1) means a risk of contamination, and level 2 (V2) means the plot is contaminated. Both affect the price and make the home harder to sell. In Danish towns an area may also be classed as “lettere forurenet jord” (lightly polluted soil). This is an estimate based on the history of the area, says nothing about your own plot, and does not affect a later sale. The certificate is not a guarantee that the soil is clean.

K

Kontantbehov ved køb (cash requirement). A calculation in the sales particulars of what you must pay for the purchase: the price, half of the ownership transfer insurance premium and the registration fee. It does not cover everything. You will also pay for buyer’s advice, the bank guarantee, registration of mortgage deeds, rate lock and your own building expert.

Kontantpris (cash price). The price at which the property can be bought without taking over the seller’s loans. Danish law requires estate agents to offer every property at an estimated cash price. You can still ask your bank whether you can take over one or more of the seller’s loans.

Kurssikring af lån (rate lock). An agreement with the bank or mortgage lender to fix the interest rate on a loan. If rates rise after the lock, you are protected, and you know what your payment will be. It can be expensive, so ask your bank what it costs. It matters more the longer it is until the takeover date.

Købsaftale (purchase agreement). The contract between seller and buyer. The seller’s estate agent prepares it from standard terms used in private home sales in Denmark. Read section 11 with care. This is where the agent adds terms for your deal, and the agent works for the seller. Extra responsibility for you can hide there, for example for pollution from an oil tank, unlawful buildings, documentation for a wood-burning stove, or separation of the sewer. There must always be a reservation for your advisor’s approval.

L

Landejendom (rural property). It can be a former farm, a country estate, a hobby farm or a working farm, with or without a farming obligation (landbrugspligt). Every property over 2 hectares is recorded as agricultural in the land register. The house inspection scheme cannot be used if there is a farming obligation, unless the purchase is made conditional on the obligation being lifted. Before you buy, find out whether there is a farming obligation, whether there is a condition report, whether any land is leased out, whether there are protected nature areas or easements, whether you meet the acquisition rules in the Agricultural Act, and how the price is divided between land and buildings, because that can matter for your tax.

Lokalplan (local plan). A plan that governs the future development of an area or a plot: how buildings may be used, what they look like, which materials are banned, where they may stand, and how much of the plot may be built on. It applies only to future changes, so existing buildings can stay. If you build against the plan, you must make the building lawful or, at worst, pull it down. Check the plan before you buy if you want to build.

M

Matrikelnummer (cadastral number). A kind of address for the property. It identifies the property in official documents such as the deed and the land register.

O

Overtagelsesdag (takeover date). The date the property is legally handed over to you. You get the keys, and the rights and obligations for the property pass to you. It must be fixed in the purchase agreement. You pay the price on this day, and the seller pays the ownership costs up to it.

R

Realkreditlån (mortgage loan). The cheapest way to finance a home in Denmark. You can usually borrow up to 80% of the price, but 75% for summer houses and 40% for building plots. There are many types, with or without interest-only periods. What is open to you depends on your finances and on the property.

Refusionsopgørelse (settlement statement). A detailed statement of the ownership costs split by who owned the home when. The takeover date is the cut-off. It usually adjusts for ownership transfer insurance, property taxes, waste collection, chimney sweeping, heating oil and association fees. It is usually made up to 30 days after the takeover date. Check it carefully.

Rådgiverforbehold (advisor reservation). A clause in section 11 of the purchase agreement, under the heading “Forbehold for købers rådgivers godkendelse”. It means the deal is not binding on you until your buyer’s advisor has gone through it with you and approved it. If you cannot agree changes with the seller, you are not bound, so it works like a free right of withdrawal. Make sure it is in the agreement before you sign.

S

Salgsopstilling (sales particulars). The estate agent’s presentation of the property: the facts about the house and plot, the cash price and the ownership costs. The law sets many requirements for what it must contain. The information must be correct, and if it is not, the seller or the agent can be held liable. Read it closely and ask about anything unclear.

Servitut (easement or covenant). A registered right or restriction on the property that binds you as the new owner. It can limit the height of the house, allow only living hedges, or ban a wooden house. It can also give you rights over shared areas or private roads. The sales particulars say whether there are any, but good and bad news can hide behind the heading. Go through all of them.

Skøde (deed). The document that secures your rights to the property. It is drawn up from the agreements in the purchase agreement. West of the Great Belt the seller’s estate agent usually prepares it. East of the Great Belt your buyer’s advisor usually drafts and registers it. It also protects you against the previous owner’s creditors. The buyer normally pays the registration fee.

Sommerhus og fritidshus (summer house and leisure home). A home meant mainly for holidays. In a summer house area there are limits on how much you may use it from November to March. These homes are often smaller, clad in wood and less well insulated than a year-round home. Special tax rules apply if you rent one out. Outside summer house areas the same limits on use do not apply, but check with the municipality. If you are not sure you are allowed to buy one, read how to buy a home in Denmark from abroad first.

Standardfinansiering (standard financing). A calculation set by law and shown in the sales particulars. It assumes a down payment of 5% of the cash price, a fixed-rate mortgage up to the maximum for the property type (80% for a house, 75% for a summer house) and a bank loan for the rest at an average rate. The result is shown as gross (brutto, the monthly payment before tax) and net (netto, after tax). As a rule of thumb, the net payment plus the monthly ownership cost gives a rough monthly cost of living in the home.

Sælgers oplysningspligt (seller’s duty to disclose). The seller must tell you about all significant matters the seller knows or should know, and that you can be expected to care about. The seller must also answer the questions in the condition report and the electrical report honestly. A seller who fails can be liable to you for the damage.

T

Tilbehør / løsøre (fixtures and chattels). The items that come with the home, for example kitchen appliances and the washing machine. The exact list is in the sales particulars under “Tilbehør”. With a summer house, all the furnishings usually come with it. Appliances must work on the takeover date. If they do not, you can ask the seller for a replacement of similar age and condition. Complain to the seller at once.

Tilstandsrapport (condition report). Made by an authorised building surveyor who goes through the property from basement to attic. It must be no more than 6 months old when you receive it. It describes the damage the surveyor can see, but says nothing about what repairs will cost. Read it critically but realistically. It is part of the house inspection scheme.

Tingbog (land register). The official register of who owns which property in Denmark. It also records rights, mortgages and other legal matters. You can look up a property with MitID and download easements and other documents.

Tingbogsattest (land register certificate). An overview of what is registered in the land register for the property. It is part of every property sale.

Tinglysningsafgift (registration fee). A state fee for registering the deed, mortgage deeds and similar documents. The seller normally pays for the deed to be drawn up, and the buyer pays the registration fee. For a deed it is DKK 1,850 plus 0.6% of the price. For a mortgage deed it is DKK 1,825 plus 1.45% of the loan amount. For a co-ownership agreement it is DKK 1,850. Rates change, so check the current figures.

U

Udbetaling (down payment). About 6-8 days after the purchase agreement is signed, you usually transfer part of the price to the seller’s estate agent. Your bank helps with this and at the same time gives a guarantee for the rest. The seller gets the money only when the sale is final and you have received the deed. The standard financing in the sales particulars assumes a down payment of 5% of the cash price.

Undersøgelsespligt (duty to investigate). As a buyer you must investigate the property yourself. The seller does not have to tell you about obvious matters that you should have noticed in a quick look around. The seller’s duty to disclose weighs more heavily than your duty to investigate. Your duty becomes stricter if the seller points out a specific matter to you and wants to be free of responsibility for it.