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Inflation down, property prices up – but the cost of living is still spiralling

Ben Hamilton
May 10th, 2023


This article is more than 1 year old.

Any forecasts of a collapse in house prices is misplaced, contends Curt Liliegreen, the head of Boligøkonomisk Videncenter

Still high! (photo: Danmarks Statistik)

It’s good news if you’re a homeowner and worried you won’t be able to pay your bills.

First off, house prices have surprisingly risen for the second month in a row. 

And core inflation (everything excluding energy and food) has just fallen for the sixth consecutive month: down from 6.4 to 6.1 percent for April, according to Danmarks Statistik.

Downward trend still expected, but no collapse
According to the Boligsiden Market Index figures for April, the price of villas and terraced houses in Denmark rose by 0.9 percent over the last month.

And owner-occupied flat and summerhouse prices rose even more steeply – by 1.3 and 1.8 percent respectively.

The increases are fuelling optimism there won’t be a significant fall in property prices in 2023 – as was previously feared. However, prices are still expected to fall over the course of the year.

“There may well be a price drop, but no collapse. Any comparison with the Financial Crisis is misplaced,” Curt Liliegreen, the head of Boligøkonomisk Videncenter, told DR.

Food prices continue to increase
Nevertheless, inflation remains high, and the overall consumer price index rose by 5.3 percent compared to April 2022 – a dip on the 6.7 percent year-on-year rise in March.

Fuelled by a continued rise in food prices – from milk and cheese to chocolate and jam – shoppers are still feeling the pinch at supermarkets that have promised price falls, but can’t say when.

Inflation peaked at 10.1 percent last October before starting to fall. The normal inflation rate in Denmark in recent years has been 2 percent.


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Moreover, 21 percent of those surveyed admitted to medicating their kids with paracetamol, such as Panodil, before sending them to school.

The FOLA parents’ organisation is shocked by the findings.

“I think it is absolutely crazy. It simply cannot be that a child goes to school sick and plays with lots of other children. Then we are faced with the fact that they will infect the whole institution,” said FOLA chair Signe Nielsen.

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At the Børnehuset daycare institution in Silkeborg a meeting was called where parents were implored not to bring their sick children to school.

At Børnehuset there are fears that parents prefer to pack their kids off with a pill without informing teachers.

“We occasionally have children who that they have had a pill for breakfast,” said headteacher Susanne Bødker. “You might think that it is a Panodil more than a vitamin pill, if it is a child who has just been sick, for example.”

Parents sick and tired
Parents, when confronted, often cite pressure at work as a reason for not being able to stay at home with their children.

Many declare that they simply cannot take another day off, as they are afraid of being fired.

Allan Randrup Thomsen, a professor of virology at KU, has heavily criticised the parents’ actions, describing the current situation as a “vicious circle”.

“It promotes the spread of viruses, and it adds momentum to a cycle where parents are pressured by high levels of sick-leave. If they then choose to send the children to daycare while they are still recovering, they keep the epidemic going in daycares, and this in turn puts a greater burden on the parents.”