Wait, are you Americans paying 5% interest on mortgage, whitout even counting insurance? For real?!
Edit: Having looked at other comments in this thread, it looks like interest are taxe-deductible, which makes it more affordable, but that's also really weird: it means the gouvernment subsidizes financial institutions to charge American consumers a lot more than the normal prize …
This is basically how American government works.
The very low interest rates charged for short fixes that we see in most of the world reflect current low borrowing costs for banks. American interest rates reflect forecast borrowing costs over the length of the loan. That's why they're much higher, they price in the expectation that over the 30 year loan period, base rates will revert back up to historically typical levels.
Yeah, it sucks, and it's 10x worse with student loans.
It's important to understand the it's not the bank that lend you the money to buy your house, at least not directly. You home is financed by bonds, issued by a sort of credit union. Investors then buy those bonds, pensions funds for instance. The Danish housing marked is extremely stable, so it's a safe place to put your money. So some investors will be willing to take a small lose on buying bonds in homes, in return for safety.