Please allow me to deviate from the political comment and other kinds of irreverent observations and give you a minor insight in what is really troubling me right now. The thing is – I have a new job, and that’s good. But I have to move, and that is, if not bad, then a pain in a certain part of my anatomy, especially as the move is from Västerbotten to Funen. Not that there is anything wrong with Funen, but we are talking about a distance of something like 1500 km.s: You don’t just make a call at a landlord or an estate agent.
The next problem is that the Danish housing market has gone completely bonkers during the time I’ve lived in Sweden. Just to give you an impression: Back in 1990, I bought a small apartment in Copenhagen NV for 250.000 DKK with a down payment of 25.000 DKK. No big deal. In early 1999 I sold it for 350.000 DKK. Nice – but two years ago I saw an advert for the apartment below mine – the asking price was … wait for it … 750.000 DKK. During my time in Sweden I’ve had rented apartments and put my savings in stocks and bonds and there was no way the stock market would follow the rise and rise of house prices. Still, I could set a reasonable target for ca. 1.000.000 DKK with a down payment of 100.000 DKK and that would buy me a reasonable 2-room apartment in Odense, provided a mortgage institute would lend me the rest of the money.
So, what are the pros and cons of buying and renting?
The big pro of buying is that you (I) are (am) your (my) own landlord, and after all you (I) know what kind of monkey you (I) are (am). Prospective sellers and mortgage financiers may also like to know that there is virtually no risk of me being unemployed for the coming 2,5 years. (The only real risk would come in the form of long-term sickness). Important knowledge in the present situation!
The cons are that a) I have no idea if I will be staying in Odense after the 2,5 years (probably not), b) selling a house or an apartment costs lots of money and c) after ten years of an uninterrupted boom, signs are that the Danish housing market is entering a more uncertain phase. Finally, as I’ve been out of the country for almost ten years, I am an unknown entity to financial institutions. (You may like to know that I have no debts … whatsoever!)
The big pro of renting is flexibility: In the worst of cases, you are only stuck with an apartment for three months. Generally there is also less uncertainty financially in renting than in buying – the risk of making a loss is much smaller.
The cons are that a) the market is rather opaque and b) you don’t know the landlords. For better or worse, the estate agent market in Denmark is dominated by a handful of firms which means that you only have to check three or four homepages to get an impression of the lay of the land. If you need an apartment at short notice public housing companies are out of the question and you really lack credible lists of potential landlords.
Let me just note that one of the advantages of having the local council as your landlord of last resort (which I’ve had since 1999) is that there are limits to the degree of monkey business you can be exposed to as a tenant. One problem with the Danish portals for rented apartments is that they don’t show any information about who the potential landlord is – you have to check the phone number on Eniro – and then, in the absence of knowing a lot of people in Odense, do a googling to see if there are stories about the person or firm in question. (Fortunately, a fellow blogger gave me a lead which I will be following)
Oh, well. I hope to have the thing settled before the end of June. I’m generally a slow starter and a ferocious finisher.