The International Monetary Fund (IMF) has said that Denmark needs to take additional measures to address “vulnerabilities” in its real estate market. <In its latest report on Denmark, the IMF said that Danish authorities should consider placing "stricter conditions on new mortgages granted to highly leveraged households," Bloomberg News reported. The Scandinavian country, whose households are among the most indebted in the world, is implementing a tax reform for its housing market, a move welcomed by the IMF as improving stability.
The IMF is also suggesting that Denmark should consider "stricter conditions for new mortgages granted to highly indebted households," Bloomberg News reported. The IMF is also proposing that Denmark lower the maximum loan-to-value ratio to the value of the mortgaged property below the current level of 95%.
The IMF is also proposing that Denmark lower the maximum loan-to-value ratio to the value of the mortgaged property to 95%. <In addition, a 7% risk threshold for losses on commercial real estate for Danish banks is set to go into effect later this month, which the Washington-based fund said would boost banks' resilience. <Last month, Denmark's central bank warned that prices of commercial real estate in Denmark could fall further as they are slow to adjust to rising interest rates.
