Bubblewatch - Dutch housing market is overheating fast!
Interest rates almost in negative territory, while housing prices go to roof.
These are symptoms that we are witnessing in many countries that expierenced/experiencing ''stimulus'' in form of Quantitative Easing.
At this moment its useless to start questioning if the ECB's policy doesnt havy any dangers or unwanted side-effects, because the statistics that the Dutch people received this morning made this painfully clear.
Last quarter more then 27% of the houses were sold for more then the original price. Amsterdam even expierenced a staggering 79% !!
The last peak was in Q1 of 2008 were houses were overbid 10% nationwide, this is 17% lower then the current 27%.
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https://i.imgsafe.org/55/5564450fb7.jpeg
The dutch housing market is strongly embedded in the economic performance of the country overal. This makes the picture above more worrying. This is not structural economic growth, but a bubble thats going to leave a lot of people in tears, because of the debt they are never able to pay back. You dont have to be a genius to see this.
For decades The Netherlands was a (small) economic powerhouse. The housing market however could bring the whole country to its knees.
Leave it to an Italian (Mr Draghi) to create a bubble and destroy a countries economy.
Some are starting to say that about the US housing market although it isnt as heated as that. In fact, in Florida here, we experienced a bit of a slow down the past two months. Will it be temporary or the start of another trend?
It depends... Housing prices over the border (Germany) are much more stable for years! (I bought a vacation home for 45.000 Euro) Almost exactly the same as the last owner payed for it 25 years ago. For the same appartment in The Netherlands i would pay triple that amount. In Amsterdam probably 4 times as much.
I know for a fact that people are struggeling in the Netherlands to pay for housing. Its just to expensive... Salaries simply not grow that fast.
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