Mortgage debt tops €800 billion for the first time ever
The total mortgage debt on Netherlands residents amounted to 804 billion euros in the second quarter of this year. It is the first time ever that the mortgage debt topped 800 billion euros, Statistics Netherlands (CBS) reported on Friday.
The mortgage debt increased by 10.6 billion euros compared to the first quarter. That is a big increase, according to Peter Boelhouwer, the senior housing market lecturer at TU Delft.
“During the period from 2011-2019, the total mortgage debt grew every year by about 10-15 billion euros on an annual basis. Now, that is practically happening on a quarterly basis,” said Boelhouwer to NOS Radio. According to him, the reason for the rapid increase is the “enormous increase” in housing prices. “That was about 20 percent last year. That makes it so people have to take out a higher mortgage.”
According to the stats office, this debt is still growing more slowly than the Dutch economy. As a result, the mortgage debt as a percentage of the Netherlands’ gross domestic product (GDP) decreased from 90.2 percent in the first quarter to 89.4 percent in the second quarter. That’s the lowest level since the first quarter of 2004.
Despite the increased mortgage debt, Netherlands residents’ real disposable income increased by 1.0 percent in the second quarter compared to a year earlier. According to the stats office, this is almost entirely due to higher wages in collective bargaining agreements and more people working.