Aided by generous sofas and an oncoming tax, are house prices, adjusted for inflation, since 1982 tripled.
Result, an average house is now € 250,000, – and the total cost private mortgage has risen to € 632 billion, which the Netherlands is the frontrunner in the world (107% of GDP).
That does of course not a problem, as long as employment, large credit, tax deductibility and, not least house prices are maintained.
A substantial change in one or more of these factors, however, the vulnerability, which now once associated with a high debt position, mercilessly exposing.
With the lowest unemployment in Europe and the political taboo that rests on the discussion of the tax deductibility of mortgage interest, about these two factors in the Netherlands temporarily well.
The generous credit, however, the last time a real problem to be. That’s not so strange when one considers that The solvency of the banks themselves under suspicion.
The debt crisis in Europe has at least made clear that banks have lent too much money to poor countries and their inhabitants and their fate depends on the political willingness of the resulting threats to shift to the taxpayer.
To the stagnant real estate market that pulling out of recession, the transfer tax is temporarily reduced from 6% to 2%. That makes at least the financing of the buyers a bit smaller. It does appear from this unique action that the government is really worried.
That’s not surprising, with an expected price decline for 2011 of around 6% (according Hans Andre de la Porte of the VEH) And strong sales stagnating. The number of homes now up for sale has doubled since 2008!
This massive supply of houses is probably not only due to the reduction in funding, but certainly also due to the unwillingness of sellers to the price to drop, driven by the expectation that recovery of housing prices around the corner.
Whether this expectation is real, is widely doubted. Expects emeritus professor Hugo Priemus the next five years drops of 5% per year.
In the U.S. property market has been attempted with various support measures afloat. This has had an impact for some time, but now the trend is downwards, and again after an average decline of over 30% from the peak of the market.