Ejerudgift – What Is It?

When you want to buy property in Denmark, you will likely come across the term Ejerudgift very early in the process. Ejerudgift is basically a made-up concept to inform you about the ongoing costs associated with owning a particular property. Commonly, it is translated as “owner’s expense.”

In this article we want to give you a clearer understanding of Ejerudgift, explain what it contains and what it does not and highlight the differences between this owner’s expense when owning a house or when buying an apartment in a larger building in Denmark.

Understanding Ejerudgift

Ejerundgift primarily applies to homeowners and refers to the regular, usually behaviour-independent, expenses they must pay on top of their mortgage. These are not one-time fees associated with purchasing a property but ongoing charges and represent a significant part of the ongoing costs of owning a home in Denmark. 

When you look at property listings, you will always see the estimated amount in Danish Kroner which previous owner’s paid per month. So keep an eye on these costs when making your decision about buying a property.

Components of Ejerudgift for Homeowners

For homeowners, Ejerudgift consists of several key elements:

 

1. 1. Ejendomsskat (Property Tax): This tax is levied by local municipalities based on the value of the land your house is sitting on and is paid twice a year.

1. 1. Ejendomsværdiskat (Property Value Tax): A tax paid to the Danish government, based on the value of the property. Unlike the local property tax, this tax is deducted automatically from your salary if you are an employee and pay income tax in Denmark.

1. 1. Ejerforening (Owner’s Association Fees) for Apartments: This covers building maintenance, insurance, cleaning, common electricity, gardening, joint loans for renovations, pest control, and more. These are essential for maintaining the quality and value of apartment complexes.

1. 1. Water Costs: These can vary; sometimes they are included in Ejerudgift for apartment owners, and sometimes they are not, depending on the property arrangement. When owning a house, these are not included.

1. 1. Environmental and Maintenance Fees: Covering garbage collection, sewage, and other environmental services provided by local municipalities. The specifics can vary widely depending on the location and services offered in the area.

1. 1. Heating Costs (if not individually metered): In rarer cases, heating costs are included in the Ejerudgift if they cannot be metered separately. This is common in properties that are part of a larger heating network or have central heating systems.

1. 1. Building Insurance: While not a tax, building insurance is mandatory for homeowners in Denmark and is often considered part of Ejerudgift. It covers the property against damages and is a prerequisite for securing a mortgage.

Here is a table that compares what Ejerudgift includes for house owners versus owners of an apartment within a bigger building. This comparison can help clarify the common expenses involved and highlight the differences based on the type of property ownership.

Expense Category	House Owners	Apartment Owners
Ejendomsskat (Property Tax)	Paid based on the land and property value; varies by municipality.	Paid based on the property value; varies by municipality.
Grundskyld (Land Tax)	Paid on the land value; varies by municipality.	Often lower as it is shared between a larger number of parties or included in the apartment association fees.
Ejendomsværdiskat (Property Value Tax)	Deducted from income based on property value.	Deducted from income based on property value.
Building Insurance	Required and paid by the homeowner.	Typically covered by the apartment owner’s association and shared between all owners.
Water Charges	Not included.	May be included in the monthly association fees, but often, it is not.
Heating Costs	Not included.	Usually not included. In rare cases included in the monthly association fees if centrally managed.
Environmental and Maintenance Fees	Covers municipal services like garbage and sewage; varies by location.	Included in the monthly association fees.
Interior Repairs and Upgrades	Excluded from Ejerudgift; responsibility of the homeowner.	Excluded from Ejerudgift; typically the responsibility of the apartment owner.

Relevance for Tenants

While tenants do not directly pay the Ejerudgift, they are indirectly affected by it through their rent, which typically includes a portion of these costs. Landlords can pass on certain expenses to tenants, usually related to the use of the property. These may include:

 

1. 1. Utility Costs: These are part of the rental agreement and can include water, heating, and electricity, depending on the lease terms. Tenants usually pay these charges directly based on their consumption.

1. 1. Maintenance Fees: Tenants may also share in the cost of maintaining common areas (if applicable), such as gardens, hallways, and other shared facilities. These costs are often included in the monthly rent.

Exclusions from Ejerudgift

While Ejerudgift covers a broad spectrum of expenses associated with property ownership, you should also know what it does not include to avoid bad surprises. Typically, Ejerundgift does not cover variable costs of maintaining a property, which can fluctuate based on usage and behaviour or unforeseen needs. 

Notably, electricity and heating expenses are usually not included unless they are part of a unified heating system in multi-unit buildings. These are considered behavioural costs since their amount largely depends on individual usage patterns.

Additionally, while Ejerudgift includes many fixed costs, it generally excludes costs related to personal property insurance, interior repairs, and upgrades, which fall under the homeowner’s responsibility. These costs vary depending on personal choices and the condition of the property. 

For instance, costs for painting, interior decorations, appliance repairs, or upgrading building features are all outside the scope of Ejerudgift. Understanding these exclusions is vital for homeowners to accurately budget for all potential expenses involved in maintaining and enjoying their property.

Additional Considerations

An Ejerudgift statement is always included in the sales page of a property. Additionally, prospective buyers can ask for a booklet to see the entire breakdown of costs, even smaller ones included in the total amount. 

These fixed costs are a critical aspect of homeownership; the lower they are, the better. In Copenhagen, these costs are usually high, often above 5000 DKK per month. However, for smaller, more affordable houses, like those shown on our partner account or our Instagram, Ejerudgift should be around 1,500 DKK and usually does not exceed 2,000 DKK per month.

Conclusion

Ejerudgift is a fundamental aspect of property expenses in Denmark. It encompasses a variety of taxes and fees that contribute to the maintenance and services provided by local governments. For anyone involved in the Danish housing market, an awareness and understanding of Ejerudgift is crucial, as it impacts the overall affordability and attractiveness of properties.