Dutch economy to grow in 2015, 2016: DNB

The Dutch economy is expected to rise in 2015 and 2016, but a more pronounced growth might be hindered by modest global economic expansion.

Economic growth in the Netherlands is still driven by foreign trade, the Dutch national bank revealed. However, in 2015 the contribution of domestic spending to the GDP should be on par with exports, and even surpass the foreign trade in 2016.

Foreign trade is expected to diminish in the future years due to poor global economic expansion, meaning Dutch exports will grow less vigorously than previously projected.

Unemployment figures in the Netherlands have been declining since 2012, but is expected to rise during the course of next year, partly due to more people entering the labour market. Unemployment should remain above the 2.5% equilibrium during the next two years, which might result in the Dutch economy not reaching it's full potential in the years ahead.

Expansion in the real estate market is evident by a 40% growth in housing sales during the first ten months of 2014. The increase in housing transactions seems to be related to lower house prices and mortgages, resulting in increased affordability.

Factors like a soaring consumer confidence, and catch-up demand from buyers who postponed their purchases last year have also made a positive impact. The bank expects real estate prices to rise over the next two years due to the increased property purchases this year.

Alas, projected price recovery remains conservative due to an influx of houses for sale, and a rise in under water mortgages.