Photographer: Freya Ingrid Morales/Bloomberg

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At the biggest mortgage bank in the world’s largest covered-bond market, a banker took a few steps away from his desk this week to make sure his eyes weren’t deceiving him.

As mortgage-bond refinancing auctions came to a close in Denmark, it was clear that homeowners in the country were about to get negative interest rates on their loans for all maturities through to five years, representing multiple all-time lows for borrowing costs.

“During this week’s auctions, there were three times when I had to stand back a little from the screen and raise my eyebrows somewhat,” said Jeppe Borre, who analyzes the mortgage-bond market from a unit of the Nykredit group that dominates Denmark’s $450 billion home-loan industry.

For one-year adjustable-rate mortgage bonds, Nykredit’s refinancing auctions resulted in a negative rate of 0.23%. The three-year rate was minus 0.28%, while the five-year rate was minus 0.04%.

Denmark’s Government Bond Yield Curve

The record-low mortgage rates, which don’t take into account the fees that homeowners pay their banks, are the latest reflection of the global shift in the monetary environment as central banks delay plans to remove stimulus amid concerns about economic growth.

Denmark has had negative rates longer than any other country. The central bank in Copenhagen first pushed its main rate below zero in the middle of 2012, in an effort to defend the krone’s peg to the euro. The ultra-low rate environment has dragged down the entire Danish yield curve, with households in the country paying as little as 1% to borrow for 30 years. That’s considerably less than the U.S. government.

In AAA-rated Denmark’s government bond market, yields are negative right through to the 10-year segment.

The negative rates have so far done little to revive inflation in Denmark, which has hovered around 1% for well over a year. The monetary environment has, however, padded Danes’ finances, as asset values have risen while consumer price growth has remained subdued.

“Danes’ private finances are incredibly strong at the moment,” Tore Stramer, chief economist at Nykredit, said in a client note. “Aside from real incomes rising nicely, interest rates are historically low and house prices as well as employment are rising across most of the country.”