Holiday home or city flat: what does two million kroner actually return?
You have two million kroner and you are considering property. A holiday home on the North Sea coast, or a flat in a city? There are hundreds of articles on that question, and nearly all of them work with gross figures that do not survive contact with reality.
Here is the calculation with every cost in it. We pulled actual asking prices, actual rent levels and the actual tax rules, and then did the arithmetic. The conclusion is not the one people usually reach.
One thing first: we are a cleaning company, not investment advisers. We work with holiday homes daily and know the running costs, but we cannot know your tax position, your risk appetite or the rest of your finances. This is an explanation of the mechanics. The decision, and a conversation with your bank and accountant, is yours.
Two businesses, not two versions of one
The first thing to understand is that these two things are not alike.
A rental flat is one tenancy agreement. It is let twelve months a year to the same person, the income is predictable, the work is low, and the risk is called vacancy and bad tenants. For tax it is a business, and interest, property taxes and maintenance are deductible.
A holiday home is forty short contracts. The income is concentrated in twelve summer weeks, the work is high because the house must be cleaned between every guest, and the risk is called weather, season and reviews. In return there is an allowance that makes a large share of the income tax free.
They are two different jobs, and they suit two different people.
What two million actually buys
All prices below are medians of the properties listed for sale on boligsiden.dk on 26 August 2026.
Flats, price per square metre:
- Aarhus C: 58,318 kr. That gives you 34 m2 for two million.
- Aarhus N: 48,306 kr. 41 m2.
- Aalborg: 22,166 kr. 90 m2.
- Viby J: 18,756 kr. 107 m2.
- Esbjerg: 17,894 kr. 112 m2.
- Herning: 16,314 kr. 123 m2.
- Holstebro: 10,821 kr.
Holiday homes, median price per house:
- Hemmet and Bork: 1.14 million kr for typically 62 m2.
- Nørre Nebel: 1.55 million kr, 80 m2.
- Hvide Sande: 2.50 million kr, 95 m2. For two million you typically get 80 m2 here, four rooms, built around 1984.
- Ringkøbing and the Søndervig side: 3.20 million kr, 105 m2.
- Blåvand: 4.15 million kr, 137 m2.
Note the spread. Two million is a small flat in Aarhus C or an entire four-room holiday home in Hvide Sande. That is not the same asset and not the same risk.
The flats: what is left over
Here is the calculation for two million kroner without borrowing, so the figures are comparable. The rent levels are the current averages per square metre per month for each city.
| City | m2 for 2 mio | Gross rent | Gross yield | Net after tax | Net yield |
|---|---|---|---|---|---|
| Aarhus N | 41 | 90,920 | 4.55 % | 15,499 | 0.77 % |
| Viby J | 107 | 115,163 | 5.76 % | 13,864 | 0.69 % |
| Aalborg | 90 | 101,777 | 5.09 % | 10,217 | 0.51 % |
| Esbjerg | 112 | 108,640 | 5.43 % | 9,040 | 0.45 % |
| Aarhus C | 34 | 66,669 | 3.33 % | 3,645 | 0.18 % |
| Herning | 123 | 89,739 | 4.49 % | -6,888 | -0.34 % |
The costs in the model are an owners' association fee of 400 kr per m2 per year, maintenance and property tax at 1 percent of value each, administration of 4,000 kr and four percent vacancy. Those are assumptions and should be replaced with your own, but they are there because they exist in reality.
Why the cheap cities lose
The most surprising line in the table is that Herning loses money, even though its gross yield is higher than Aarhus C.
The explanation is square metres. At 16,314 kr per m2, two million buys you 123 m2. The association fee, maintenance and heating follow the floor area, while rent per square metre in Herning is only 61 kr a month. You are buying a lot of floor that costs money to own and cannot be let for enough.
The same mechanic hits every cheap city in the table. A low price per square metre looks like a bargain until you count the running costs.
And why Aarhus C does not work either
At the other end, two million buys 34 m2 in Aarhus C and the net yield is 0.18 percent. That is not an income investment. It is a bet that the price rises, and you should be honest with yourself about that before signing.
The holiday home: the same calculation
We took a two million kroner holiday home in Hvide Sande, so about 80 m2, four rooms, sleeping six to eight, no pool. Eighteen rental weeks, which sits in the middle of what the industry reports.
- The guest pays for the house: 115,000 kr.
- Agency commission at 30 percent: minus 34,500 kr.
- Your payout: 80,500 kr.
- Electricity, insurance, property tax and maintenance: minus 47,000 kr.
- Tax: minus 7,636 kr.
- Net: about 25,900 kr, or 1.29 percent.
So the holiday home beats the best flat in the table, 25,900 against 15,499 kr.
The reason is the tax, not the rent. The allowance on holiday home letting in 2026 is 50,200 kr when letting through an agency or platform that reports to the Danish tax authority. Of the amount above it, only 60 percent is taxable. You are also not taxed on the agency's commission, because it is deducted before the income is calculated.
On an ordinary holiday home that means most of the rent is effectively tax free. A rental flat has no equivalent allowance and pays tax on the whole profit.
The trap waiting for expensive holiday homes
Here it gets interesting, because the allowance is not always a gift.
The allowance method taxes 60 percent of your payout, regardless of what you spent. On a small house with small costs that is an advantage. On an expensive house with large costs it is a penalty.
We ran a four million kroner holiday home in Henne Strand, where the median at that price is 154 m2 built around 1995. Two variants:
| No pool, rent 160,000 | With pool, rent 250,000 | |
|---|---|---|
| Your payout | 112,000 | 175,000 |
| Actual costs | 83,000 | 145,000 |
| Real profit before tax | 29,000 | 30,000 |
| Tax, allowance method | 15,574 | 31,450 |
| Tax, accounts method | 12,180 | 12,600 |
| Net, best method | 16,820 | 17,400 |
Two things stand out.
The pool earns 90,000 kr more in rent and delivers 580 kr more profit. Electricity alone in a large pool house runs around 31,000 kWh a year, roughly 61,000 kr, and on top come water treatment, servicing and a heavier clean at every changeover.
Under the allowance method the pool house loses 1,450 kr. Under accounts-based deduction it makes 17,400 kr. The difference is nearly 19,000 kr a year and lies entirely in which method was chosen. The choice is binding and requires documentation, so it is an accountant conversation, not a click.
Note too that a four million kroner holiday home returns less than a two million one. Maintenance and property tax follow the price, while the rent does not rise correspondingly.
The options side by side
| Investment | Net per year | On the capital |
|---|---|---|
| Holiday home with facilities, year-round destination, 4.9 mio | approx 280,000 | 5.7 % |
| Holiday home, 2 mio, Hvide Sande, no facilities | 25,900 | 1.29 % |
| Flat, 2 mio, Aarhus N, ordinary letting | 15,499 | 0.77 % |
| Flat, 2 mio, Aarhus C, ordinary letting | 3,645 | 0.18 % |
| City flat on Airbnb | not lawful as a full-time business | |
The gap between the top and bottom lines is a factor of thirty. It is not the price that drives it, and it is not the property type either. It is three things: how many weeks the property may lawfully be let, how many of those actually sell, and who pays the running costs.
A holiday home in a year-round destination scores well on all three. A city flat scores badly on the first and is therefore capped, however good the location.
And what about Airbnb in the city?
It is the obvious question: why not buy a flat in Aarhus or Vejle and let it to tourists on Airbnb instead of on an ordinary tenancy? The weekly rate is higher and you are not tied to one tenant.
The answer is that in practice it cannot be done in Denmark, and it is worth understanding why before calculating further.
The residence obligation
A year-round dwelling is subject to bopælspligt, a residence obligation. The home must be occupied for year-round residence at least 180 days a year, either by you or by a tenant with a registered address there. If it stands empty and is not for sale, the owner must contact the municipality within six weeks, and the municipality can order you to get it occupied.
Short-term letting does not satisfy the residence obligation. It requires a permanent resident registered at the address, and a stream of holiday guests does not count.
The day limits
On top of that there is a ceiling on how much a year-round dwelling may be let for holiday purposes:
- 30 days a year if you handle the letting yourself.
- 70 days a year if you use a platform that reports to the Danish tax authority.
- Some municipalities can raise the limit to up to 100 days.
The allowance for short-term letting of a year-round home is also lower than for a holiday home: 35,100 kr in 2026 against 50,200 kr.
The consequence
If a year-round dwelling is used for short-term letting on any scale, the municipality can treat it as commercial use, a so-called shadow hotel, and demand re-registration or order it to stop.
So the model does not exist as a lawful full-time business. Seventy days is ten weeks. The calculation that made the holiday home interesting was built on thirty-eight.
That is also the whole explanation for why the holiday home wins so clearly. A holiday home may be let around forty-one weeks a year and carries no residence obligation. A year-round home may be let ten weeks and carries one. The law has simply built one for short-term letting and the other to prevent it.
Flexbolig: the one route to having both
You asked whether you could buy a flat in, say, Aarhus or Vejle, use it as your secondary address and let it out when you are not there. There is in fact a scheme for exactly that, called flexbolig.
A flexbolig permit is municipal permission to use a year-round dwelling as a holiday home. Once granted, the residence obligation no longer applies to that property. You may use it as much or as little as you like, and you may keep it as an additional home alongside your own.
And here it gets interesting for letting: a flexbolig can be let on the same terms as a holiday home. The Danish Planning and Rural Districts Agency has stated that a private individual letting one or two flexboliger is normally not considered commercial letting, provided the owner genuinely uses the property at least two weeks a year and the letting does not exceed forty-one weeks.
In other words, a flexbolig can give you both the secondary address and the many rental weeks that an ordinary year-round home is not allowed.
The catch, and it is a large one
Flexbolig is a municipal permission, and municipalities grant it where housing is in surplus, not where it is short. The scheme exists to avoid empty houses in areas losing population.
So permits are typically granted in municipalities such as Lolland, Guldborgsund and Vordingborg, and in rural districts. Vejen municipality, for example, decided that applications can be made outside the urban zones of Brørup, Holsted, Rødding and Vejen.
In a city like Aarhus, where there is a housing shortage and the municipality is working to create more homes, a flexbolig permit for a flat is in practice very unlikely. Nor is a permit available where the local plan designates the area for year-round residence, which it typically does in a town centre.
What that means for your question
In short: the idea is right but the geography is wrong. If you want a property you both use yourself and let for many weeks, look for a flexbolig in an area with surplus housing, not for a flat in a growth city.
And at that point you are effectively back at the holiday home, which has the same rights without having to apply for them, and which sits where the holiday guests actually are.
Three things to check if you pursue it: in most municipalities the permit follows the owner and must be applied for again on sale, the local plan can rule it out entirely, and the requirement that you use the property at least two weeks a year is a condition, not a suggestion.
This is an area where the rules vary between municipalities. Ask the specific municipality before calculating on a specific property.
The work no table shows
The figures above treat the two as if they cost the same effort. They do not.
A flat is one contract, one move-in, twelve rent payments and hopefully nothing in between. Let for three years, you have had three days of work.
A holiday home with eighteen rental weeks is eighteen changeovers. Each is a Saturday between ten and three, where the house must be cleaned, beds made, dishes cleared, waste taken out and consumables restocked. On top come bookings, messages, damage, keys and reviews.
That work can be bought, and it is a real cost. Our starting prices for guest-ready holiday home cleaning are 800 kr up to 70 m2 and 1,200 kr up to 100 m2. Multiplied by eighteen changeovers that is 14,400 to 21,600 kr a year, about a fifth of the gross rent. It is included in the figures above.
The point is not that it is expensive. The point is that the holiday home's higher return is partly payment for a job. Remove the job by buying your way out of it and the return falls towards the flat's.
Financing turns the picture around
Everything above is calculated without borrowing. If you borrow, the ranking changes, and this is probably the single most important point in the article.
For a rental flat, interest is deductible, because year-round letting is a business. You can also mortgage a year-round home up to 80 percent.
For a holiday home you can mortgage up to 75 percent, but holiday homes classified as commercially let have a separate limit of 60 percent. The contribution rate is higher too: at Totalkredit, in the 40 to 60 percent band it has been 1.15 percent for holiday home loans against 0.85 percent for year-round home loans. And if you use the allowance method, you cannot deduct the interest.
The consequence is simple. If you want to gear the investment, the flat is the better instrument: you can borrow more, more cheaply, and the interest is deductible. The holiday home demands a larger deposit and gives you less tax help carrying the loan.
Should you sell after a few years?
You asked, and the answer is usually no, for two reasons.
Transaction costs. A purchase and a sale together consume a substantial part of a modest gain. Agent, lawyer, registration and possibly new financing all have to be earned back before you are at zero.
Tax. Here is a difference worth knowing. A gain on selling a rental flat you have never lived in is taxable. A gain on selling a holiday home you have used yourself can be tax free under the holiday home rule. The conditions are specific, and this is exactly the sort of thing to have confirmed by an accountant for your own situation rather than read on a blog.
That points in a particular direction: buy intending to own for a long time, not to flip. At these returns it is the price rise that has to carry the investment, and price rises come over years, not months.
Our assessment, said plainly
You asked for a recommendation and not only numbers, so here it is, with the clear caveat that we do not know your situation.
If you want income and will accept the work: a holiday home in a year-round destination with many bathrooms and facilities. Not the cheap house in the quiet area. The calculation on a real house of that type, 180 m2 with six bathrooms in Bjerregaard at 4.9 million kr, landed around 5.7 percent net, which is seven times the best flat in the table.
That is an important correction to what most people assume. The expensive house is not the bad buy. The bad buy is the cheap house in an area with no winter guests, because you are paying for square metres you can only let four months a year.
If you want calm and predictability: a rental flat on an ordinary tenancy, but be honest that you are accepting 0.5 to 0.8 percent to avoid the work. Aarhus N and Viby J look best in the table. Herning and the cheapest cities should be avoided, because you buy too many square metres.
If you are betting on price growth and using leverage: a flat in a city with population growth. Not because the rent is better, but because you can borrow 80 percent, the interest is deductible and the contribution rate is lower.
If you want to let on Airbnb in the city: you cannot, not as a full-time business. Seventy days a year and the residence obligation close that model. See the section above.
If you want to use the property yourself and let it for many weeks: that requires either a holiday home or a flexbolig, and a flexbolig is only granted in an area with surplus housing.
What we would advise against: buying a holiday home in a purely seasonal area with letting as the only purpose. Not because those areas are poor, but because the season runs May to September, and a calculation built on thirty rental weeks does not hold there.
Five things we see go wrong
- Maintenance set to zero. One percent of value a year is what separates the cheerful calculations from the correct ones. On a two million house that is 20,000 kr.
- Gross yield mistaken for return. Every city in the table has a respectable gross yield. Half of them earn almost nothing.
- The association fee overlooked. On a 90 m2 flat it is over 36,000 kr a year in our model.
- Rental weeks set too high. Fifteen to twenty is normal. Forty is not legal: winter letting is capped at nine weeks.
- The wrong tax method. On an expensive holiday home, choosing wrongly costs up to 19,000 kr a year.
Sources
All figures were gathered in August 2026. Rules and rates change, so check them before building on them.
- Asking prices for flats and holiday homes: boligsiden.dk, medians taken 26 August 2026.
- Rent levels per square metre: BoligScout and lejeboligportal.dk, 2026.
- Allowance and taxation on holiday home letting: BDO.
- Commission deducted before the calculation: RSM Denmark.
- Tax on year-round letting and deduction of running costs: Dansk Revision.
- Loan-to-value for holiday homes: Skøde Centret.
- Electricity consumption in holiday homes: Nettopower.
- Rental income by house type: Compada.
- The nine week limit on winter letting: Planning Act section 40.
- Residence obligation and short-term letting: Skøde Centret.
- The flexbolig scheme: Bolius and Ringkøbing-Skjern Municipality.
Shall we take the cleaning?
If you end up with a holiday home, the changeover is the part that has to work every single week in high season. We are a local cleaning company based in Nørre Bork, and we do holiday home cleaning and guest changeovers in Bork Havn, Hemmet, Hvide Sande, Søndervig, Nymindegab, Henne Strand, Blåvand, Skjern, Tarm and Ringkøbing.
If you are running the numbers on a specific house, send us the address and the size. You will get a fixed price per changeover to put straight into your own spreadsheet instead of a guess. For the full operating calculation on a letting holiday home, we have it in the detailed review of letting economics.