Prime Minister Mette Frederiksen has proposed both a temporary cap on rent increases due to inflation, which is expected to affect hundreds of thousands of residents in Denmark, and an investigation into the failures of the current rent increase system.

“Some people are currently seriously worried about their rents and this should not be happening in Denmark,” Frederiksen told TV2.

Skyrocketing rents
Under the current system, rent increases are permitted according to the level of inflation. Based on the so-called Net Price Index, landlords have been within their rights to increase rents by up to 8.8 percent between July 2021 and July 2022.

“A rent increase of 8-9 per cent would be too high for many people: for example, the student population,” Frederiksen said.

Cap on rent increases set
The government wants to set a cap on rent adjustments for private rental properties of up to 4 percent over two years.

According to Frederiksen, this is because we are in an “extraordinary period” in which the Danes are already under financial pressure due to record high inflation.

In addition, the government is proposing to introduce a different index to replace the Net Price Index, which is only now used to regulate rents.

“We will examine whether it is entirely reasonable to take rising food prices into account when setting rents. Because it has nothing to do with rents,” said Frederiksen.